Judicial Pensions

Lord Fowler: asked Her Majesty's Government:
	What changes they are making to the judicial pension scheme.

Baroness Ashton of Upholland: My Lords, the judicial pension scheme will become a non-registered pension scheme in accordance with the provisions of the Finance Act 2004 on 6 April 2006. The details were set out in a Written Ministerial Statement made by my noble and learned friend the Lord Chancellor on 15 December 2005.

Lord Fowler: My Lords, I thank the Minister for that reply. Is not the effect of the changes to avoid the new pension law, introduced by this Government, which places a lifetime limit of £1.5 million on the capitalised value of anyone's total pensions benefits? That is not an ungenerous limit. Does she therefore think it is right that judges should be exempt from pension rules that apply to everyone else?

Baroness Ashton of Upholland: My Lords, as the noble Lord knows, the judiciary is covered by statute. As the responsible Minister, my noble and learned friend looked at what was in the best interests of ensuring that the judges remained in their current position. The changes that we have made will mean that the judiciary maintains its status quo. I believe that that is an appropriate way for the Lord Chancellor to have behaved.

Lord McIntosh of Haringey: My Lords, I am surprised that my noble friend did not correct the noble Lord, Lord Fowler, in his supplementary question. There is no limit on the provision that people can make for pensions; the only limit is on the amount on which you can get tax relief.

Baroness Ashton of Upholland: Indeed, my Lords. I am grateful to my noble friend for saying that; it is exactly the position.

Lord Oakeshott of Seagrove Bay: My Lords, will the Minister tell us what capital sum would be needed to buy from a private sector provider the index-linked pension on which a High Court judge will now retire? I think that she will find that it is rather more than £1.5 million. If she does not have the figure to hand, will she please write to me with it?

Baroness Ashton of Upholland: My Lords, the noble Lord will be astonished to learn that I do not have the figure to hand, and of course I will write to him. The critical cost factor is the cost to the DCA, which I can confirm, as was laid out in the Statement, is £9 million per year.

Lord Borrie: My Lords, the reluctance of a number of senior lawyers, especially Queen's Counsel, to become High Court judges is often attributed to concern about a fall in income. To what extent is that true at present and to what extent are people who might become eminent judges if they were appointed also concerned about pensions?

Baroness Ashton of Upholland: My Lords, I have no doubt that those who are considering a judicial career think about pensions. The noble Lord will know that currently they cannot return to practice; therefore, it is important to take into account our need to have a good judiciary in this country and to make sure that they benefit appropriately.

Lord Lloyd of Berwick: My Lords, can I ask the Minister for some private advice? Does anything that has happened affect the position of retired judges?

Baroness Ashton of Upholland: My Lords, as far as I understand it, it does not. If that is not the case, I will of course write privately to the noble and learned Lord and ensure that his position is secure.

Lord Fowler: My Lords, of course the Minister and the noble Lord are right about tax relief—there is no issue about that. But does she recognise that past changes have always been made openly and passed through Parliament in legislation? Does she not think, on reflection, that it was a pity that this profound and important change was made by means of a Written Answer, not even an oral Statement?

Baroness Ashton of Upholland: My Lords, it was made not by Written Answer but by a Written Ministerial Statement, a process that the noble Lord will know is appropriate in Parliament. We do not use primary legislation if we do not need it. Within the terms of the Finance Act and with regard to the way in which we were able to do this, primary legislation was not necessary. We have not attempted to be anything other than completely open; hence the Written Ministerial Statement.

Older Workers

Baroness Gardner of Parkes: asked Her Majesty's Government:
	What research is being undertaken to design and develop workplaces to meet the needs of the older worker and address the associated issues of commuting and travel to work.

Lord Hunt of Kings Heath: My Lords, research commissioned by my department's Age Partnership Group shows that aids and adjustments to the workplace can overcome problems associated with age and improve the functioning and productivity of all workers. I understand that the Department for Transport has also commissioned a study on the travel needs of people in later life, which will be available later in the year.

Baroness Gardner of Parkes: My Lords, I thank the Minister for that reply. Does he agree that it is important to give thought to this, as many people who had envisaged retiring at 60 will suddenly find themselves faced with a further five years of work? Even travelling to work on a train early in the morning can, for an older person, be difficult when carriages are extremely crowded and people have to stand. Should more be done to improve people's lot, not only in the workplace?

Lord Hunt of Kings Heath: My Lords, I assume that the noble Baroness is referring to the equalisation of state pension age for women occurring between 2010 and 2020. I take her point. The question of transport and the implication that older people may want to travel off-peak may encourage employers to think about more flexible working. My department would certainly encourage that. As for the general point, the more that we encourage older people to stay in work the better.

Baroness Greengross: My Lords, does the Minister not agree that employers, particularly from small and medium-sized enterprises, will need a lot of help and possibly incentives to encourage them to get this right? For example, employers should consider the ergonomics of the workplace, retraining and reskilling older workers and appraising workers throughout their career on the basis of their competence and capacity to do a job, not on the basis of their age.

Lord Hunt of Kings Heath: My Lords, I agree with all the points raised by the noble Baroness. I can report to the House that many companies are now developing very positive attitudes towards older workers. They are changing their policies, encouraging older workers and looking at aids and adaptations. I agree with the noble Baroness that we need to make sure that small and medium-sized enterprises are part of that as well.

Lord Howarth of Newport: My Lords, is it not the case that older people, like babies, are usually more robust than they appear? Your Lordships' House is testimony to that. What with demographic change and the difficulties that we are discovering in providing pensions, is it not the reality that people will have to work much longer, well beyond the age of 65, not in especially sheltered conditions but in the mainstream of the labour force, if they are to enjoy the living standards and the continuing good health that they want?

Lord Hunt of Kings Heath: My Lords, we have an aspiration for 1 million older people to stay in work over the next considerable number of years. As far as the state pension age is concerned, that was one of the recommendations made by the Turner commission, and the Government will be responding and outlining their policy on pensions later in the spring. As far as your Lordships' House is concerned, the definition in the DWP of an older worker is, I am afraid, anyone over 50. On that reckoning, I am afraid that all of us, apart from 38 Members of your Lordships' House, are classified as older workers. I think that we show very well the contribution that older workers can make.

Lord Skelmersdale: My Lords, this is about more than equalising the pension age between men and women in 2020. Does the Minister agree with various of his colleagues in government who have said that it is inevitable that the state pension age for everyone will have to be extended after 2020?

Lord Hunt of Kings Heath: My Lords, the noble Lord has probably spotted that my right honourable friend the Secretary of State said in a speech two days ago that, in his view, some increase in the state pension age from 2020 was now inevitable. He went on to say that any rise would be acceptable to people only if it came as part of a package to improve pension provision in other key areas that the report by the noble Lord, Lord Turner, addressed. As I have said, we will bring forward our proposals on pensions later in the spring.

Lord Addington: My Lords, many good projects are planned and are in the pipeline to help the disabled travel to work and be in the workplace. If they were implemented more quickly, would not many of the problems of those few frail or disabled elderly people in the workplace be greatly reduced?

Lord Hunt of Kings Heath: My Lords, the noble Lord will know that the number of disabled people in work has increased considerably in the past few years, but at 46 per cent it is considerably less than other people in work. In general, about 75 per cent of the working-age population are in work. There is clearly a long way to go. He will know of course of the work of the DRC and of the Office for Disability Issues in my department. We clearly want to encourage employers as much as possible to recognise the benefits for them of employing more disabled people.

Lord Taylor of Blackburn: My Lords, as all parties are concerned, is there not a need for an all-party recommendation on this? When the Government have looked at the Turner report, should not a royal commission look at it from an all-party point of view, as took place with the Education Act 1944, when the policy was agreed by all concerned? The Education Act 1944 made such a difference to education in this country.

Lord Hunt of Kings Heath: My Lords, I certainly agree with my noble friend that it is important to achieve as much consensus as possible on pension policy. In our proposals, we will set down a policy on pensions for many years ahead. It is clear that, over the past 20 or 30 years, inconsistency and changes in pension policy have played a part in reducing public confidence. I agree with my noble friend there, but I do not agree with him about a royal commission. We have had the Turner commission, and it is now time for the Government to bring forward our proposals. We will do so.

Baroness Howe of Idlicote: My Lords, one of the concerns has been the lack of research and co-ordination in workplace design. What further plans are there for co-operation in design and better rapport between the Department for Work and Pensions, the Office of the Deputy Prime Minister and the Economic and Social Research Council?

Lord Hunt of Kings Heath: My Lords, I have already referred to two pieces of research that the Government are concerned with, but I agree with the noble Baroness that more needs to be undertaken. I am happy to write to her about the research that is being done. I also agree that we need a cross-government approach, as illustrated by the work and transport issues that the noble Baroness raised. We are consulting on the establishment of an observatory on ageing, which will go some way to meeting the requirement that she mentioned.

Lord Sutherland of Houndwood: My Lords, the Mobility and Inclusion Unit is running a research programme on the design of motorcars, with a view to making it easier for older drivers with impairment to travel. When are recommendations expected; and, if not soon, can they be hurried up?

Lord Hunt of Kings Heath: My Lords, I am grateful to the noble Lord for that information. I do not know when the report is likely to be received, but I will find out and let him know.

Lord Skelmersdale: My Lords, the Minister will remember that, in his answers on the Statement on the publication of the Turner report, he said he would negotiate with the Chief Whip for a debate. This Question has almost turned into such a debate, but would he agree that we now need a full debate before the White Paper is published?

Lord Hunt of Kings Heath: My Lords, of course, as the Chief Whip has just reminded me, that is a matter for the usual channels rather than myself, but I have said to the noble Lord, as I have to other noble Lords, that I would welcome a debate at any time on the Pensions Commission's report. After the Government have produced their proposals, no doubt, there will be further opportunities for debate.

Lord Harrison: My Lords, does not my noble friend's comment about creating a new observatory show the Government's 20-20 vision on this point?

Lord Hunt of Kings Heath: My Lords, my noble friend is as accurate as ever about the Government's programme in this area.

Energy: Domestic Supplies

Baroness Trumpington: asked Her Majesty's Government:
	What financial assistance they give to those who find themselves without power or heating in their homes due to exceptional circumstances such as the oil depot explosion at Hemel Hempstead.

Lord Bassam of Brighton: My Lords, the Civil Contingencies Act 2004 requires local authorities, the emergency services and other prime responders to develop appropriate contingency plans to respond to major disruptive incidents, such as the depot explosion at Hemel Hempstead. Financial assistance to affected local authorities is available from the Government, under the Bellwin scheme, operated by the Office of the Deputy Prime Minister. Under the scheme, assistance is limited to 85 per cent of eligible costs above an annual threshold of 0.2 per cent of the authorities' non-capital budget.

Baroness Trumpington: My Lords, on Hemel Hempstead—I apologise if my Question is a bit long, but it is too important to shorten—is the Minister aware that over 2,000 people were evacuated and eight families are still homeless? Is he aware that many windows are still boarded up, thus making any heating inefficient, and fuel costs have rocketed phenomenally for people who are not well off? In the present cold weather, are there no funds from the Government that can help those people?

Lord Bassam of Brighton: My Lords, obviously I am aware of the considerable damage caused by the explosion. The Government's reaction has been much praised for its swiftness and the way in which it has worked. Much credit should go to the local authority, which has worked hard to ensure that people return as soon as possible to their home. My information is that four families are still occupying temporary but good quality accommodation and that a number of households are still in need of important repairs. Funds are of course available through the Jobcentre Plus scheme to assist families that are in particular hardship, and efforts have been strenuously made by the local office to ensure that they receive funds as quickly as possible. Indeed, the information that I have suggests that all fire-related claims that went through the Jobcentre Plus scheme were dealt with on the same day.

Baroness Scott of Needham Market: My Lords, is the Minister aware that the cost to Hertfordshire County Council has been in the region of £2.5 million? Can he tell the House whether the council will receive the full 85 per cent towards that cost? Can he assure the House that, if the council has to meet the shortfall from its own resources, that will be taken into account by the Government when they set the capping regime?

Lord Bassam of Brighton: My Lords, this is obviously a delicate area, and careful considerations have to be made. My understanding is that the Office of the Deputy Prime Minister, through its officials, has advised the local authorities that have been affected. I must say that that is a welcome change from the days when I was a local authority leader, when we did not get much external advice to help us with Bellwin schemes. These exchanges have enabled the ODPM to give the authorities early help with the procedures to follow what would constitute eligible costs. Of course, they will be entitled to receive all those eligible costs above the 0.2 per cent threshold, which I mentioned in my initial response.

The Countess of Mar: My Lords, is there not some liability on the part of the owners of the oil depot? Do they not have insurance, and cannot claims be made against the owners' insurance? Why are the Government paying?

Lord Bassam of Brighton: My Lords, that is absolutely right. Again, I am informed that a number of lawyers are in the area working carefully with affected residents to advise them.

Noble Lords: Oh!

Lord Bassam of Brighton: Look, this is not the time or place to be cynical. Of course, it has been the policy of successive governments not to pay compensation to householders or businesses for any losses that are insurable. We expect the insurance system to work well in this situation, and I am sure that it will.

Baroness Trumpington: My Lords, I do not believe that the Minister has answered my Question. Is he aware that I totally disagree with the noble Countess? What is needed is cash now. Having had absolutely no heating myself, I would not put my trust in lawyers or in British Gas, whose representatives do not come when they say they will and make a mess of it when they do.

Lord Bassam of Brighton: My Lords, those are private companies with public responsibilities that they are expected to meet. The local authority and the Jobcentre Plus officials working locally have done everything that they reasonably could to assist those families and households, who have, I know, been getting good help and assistance from the local citizens advice bureau. There may well be some cases that have slipped through the net. If the noble Baroness would like to approach me personally with examples of those, I shall make sure that they are dealt with as promptly as possible.

Lord Skelmersdale: My Lords, emergency help is available in many instances from the Social Fund. Can the Minister say whether that fund has been operating in the Buncefield area, especially for those people on limited incomes to whom my noble friend has just referred?

Lord Bassam of Brighton: My Lords, the advice that I have is that Jobcentre Plus has received 50 benefit claims related to the incident and has paid six crisis loans. Of the new claimants, 13 have now come off benefits, thankfully. As I said earlier, all fire-related claims were processed and paid on the same day.

Lord Oakeshott of Seagrove Bay: My Lords, does the Minister know what proportion of households in this country has no contents insurance? If not, could he again find out and let us know? He will find that it is significant in the lower income groups.

Lord Bassam of Brighton: My Lords, I do not have specific figures on that, as the noble Lord may perhaps expect on a matter related so closely to one particular incident in one place. However, the point made by the noble Lord is very reasonable. I know, from my local government experience, that we used to try to assist low-income households—particularly those living in council housing—to get into insurance schemes. We ran a scheme in my local authority that gave tenants the option of having insurance cover for household contents through their rental.

Cancer: Herceptin

Lord Forsyth of Drumlean: asked Her Majesty's Government:
	Whether they will respond to recent representations by taking steps to ensure that appropriate drugs are made available to patients for the treatment of breast cancer in cases where general practitioners have confirmed the need.

Lord Warner: My Lords, breast cancer patients should be managed by specialist cancer multi-disciplinary teams. It would be a doctor in that team who would decide, in consultation with the patient, the most appropriate treatment for their condition, having regard to NICE guidance. The NHS should not refuse to fund treatment simply because NICE guidance is unavailable.

Lord Forsyth of Drumlean: My Lords, I am grateful to the Minister for that answer, but are the Government aware of the "Panorama" poll of 390 oncologists that was carried out recently in England and Wales? It found that 28 per cent were always allowed to prescribe Herceptin for the early treatment of breast cancer but that 58 per cent were only sometimes allowed to do so. How can it be right that access to treatment for NHS patients who have no insurance for what is, after all, a life-threatening condition depends on where they live and on decisions taken by administrators and accountants, rather than clinicians?

Lord Warner: My Lords, there is a general issue of access to cancer drugs and a specific one in relation to breast cancer drugs. It is for individual clinicians to consider with patients, taking into account risks and their medical history, whether a particular drug is an appropriate treatment choice. We have made it absolutely clear to primary care trusts that they should not rule out treatments on principle but consider individual circumstances in reaching their decision. We have equally made it clear that, in the case of Herceptin, PCTs should not refuse it solely on grounds of cost.
	We can do no more at this stage, and I suggest that we must not take any steps that undermine either the licensing process for drugs, which have patient safety at their heart, or the NICE appraisal process.

Baroness O'Cathain: My Lords, is the Minister aware that on 27 October last, in evidence to the Health Select Committee in another place, the Secretary of State said that women who had been refused Herceptin on the ground of cost should return to their doctor and ask again to be prescribed the drug? She told the Committee that she,
	"wanted to make sure that",
	the prescribing of Herceptin to eligible women,
	"was happening everywhere".
	Has the Minister any idea of the impact on an individual of the news that they have breast cancer? The last thing that they want to do is to go back and forth to doctors on the odd chance that they may or may not get Herceptin.

Lord Warner: My Lords, there are two sets of issues here: Herceptin in relation to advanced breast cancer and Herceptin in relation to a proportion of women who have early breast cancer. Herceptin is not licensed for the purposes of women who have early breast cancer. The noble Baroness may shake her head, but that is the factual position. The Secretary of State has said that no PCT should rule out the decision by a clinician to prescribe a particular drug on grounds of cost; but there is a wide range of considerations to be taken into account.

Lord Tebbit: My Lords, does the Minister not agree that it would be particularly unfortunate if any of the factors that he has set out regarding the suitability of the drug, which is a matter for doctors, and possibly of its cost, which is a matter for the health service, were to be settled in court by judges who are not doctors and are not responsible for providing the funds to meet what might be their judgment?

Lord Warner: My Lords, if the noble Lord is referring to the case currently before the courts, I do not think that I can comment on it, as it is sub judice.

Lord Addington: My Lords, there is a real problem here given that you can be clinically prescribed a drug that you are not going to get. We have been through this before and it is looking again like a postcode lottery. Will the Minister give us some idea of when the Government will introduce a system that will stop this happening?

Lord Warner: My Lords, I have said that there are two sets of issues. One is the use of Herceptin in relation to women with advanced breast cancer, for which it is licensed and for which there is NICE guidance. There is little evidence that the drug is not being provided where it is thought to be clinically appropriate. The argument seems to be over the use of Herceptin in relation to women in the early stages of breast cancer. The drug is not licensed for that purpose; it is down to the individual clinician, with the patient, to make a judgement whether it is appropriate in those circumstances. It is then for the PCT to weigh those issues in relation to those patients. That is the system that we have and that system has stood us in good stead over many years in relation to many drugs.

Lord Walton of Detchant: My Lords, would the Minister accept that not every case of breast cancer is suitable for treatment with Herceptin; it depends upon the genetic constitution and the nature of the tumour? But is it not the case that individuals with breast cancer and who have a genetic constitution that makes them sensitive to the drug are not always receiving it through their primary care trust? Are the Government making it clear to primary care trusts that such individuals should be given priority for the prescribing of this drug?

Lord Warner: My Lords, it is not for Ministers and the Government to give detailed prescriptions to the NHS that override the judgments of individual clinicians in relation to individual patients. All noble Lords must try to hold on to that issue in relation to what is, I freely acknowledge, a very emotional area. I have already stated the Government's position; it is down to individual clinicians to consider with patients whether Herceptin is appropriate—as the noble Lord said, it is not appropriate in all cases—and that PCTs should not rule out treatments, either on principle or for funding considerations.

Baroness Symons of Vernham Dean: My Lords, does not my noble friend have some difficulty with the figures given by the noble Lord, Lord Forsyth of Drumlean? Of course such decisions should be made on the grounds of medical advice, but if 28 per cent of doctors say that they are never allowed to prescribe the drug in those circumstances, it looks as though these decisions are being taken, not necessarily on principle, but on grounds of cost. Surely, that is ground for concern, given what my noble friend has, quite rightly, articulated as being the Government's policy.

Lord Warner: My Lords, with all due respect to my noble friend, the figure of 28 per cent came from a study produced on "Panorama". I have no idea whether that particular study is valid; I have not seen the research methodology. I can tell the House that as a health Minister one sees many studies that turn out to be methodologically flawed when the information is probed. I am sure that other Ministers in this House have had the same experience. In the particular cases of the alleged 28 per cent, it is down to those doctors to discuss the individual patients causing them concern with the people in the PCT.

Business

Lord Grocott: My Lords, with the permission of the House a Statement will be repeated later today. The Statement will be on child support and it will be repeated by noble friend Lord Hunt. We will hear it after the first debate, introduced by the noble Lord, Lord Hurd.

Business of the House: Debates Today

Baroness Amos: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the debate on the Motion in the name of the Lord Hurd of Westwell set down for today shall be limited to three hours and that in the name of the Baroness Knight of Collingtree to two hours. —(Baroness Amos.)

On Question, Motion agreed to.

Iran

Lord Hurd of Westwell: rose to call attention to the situation in Iran; and to move for Papers.
	My Lords, I am most grateful for the opportunity to start a discussion among your Lordships about Iran, which I think is timely and of great importance. What happens in Iran is linked with events in Iraq, Afghanistan and Palestine, and to some extent we cannot make sense of this situation unless we look at the whole. An observer 10 years ago, trying to look forward, might have guessed that the Palestine dispute would remain unsettled. But I do not think that even in a nightmare he or she would have supposed that Britain would have 8,000 troops deployed in southern Iraq and be sending 4,000 troops to southern Afghanistan for three years. Both are dangerous missions in disorderly places, with troops in both cases in danger, not primarily from foreign invaders but from those Afghans and Iraqis who resent our presence as a foreign occupation. Nor would the observer have guessed that while extending ourselves in those two places we would be locked in a tense argument with a powerful country lying between those two deployments, because of well founded fears that Iran has an ambition to copy Israel and Pakistan by becoming the third nuclear military power in the region.
	My first point is this. I wish I felt confident that the planners in Whitehall, the Chiefs of Staff and, above all, the Cabinet sometimes looked at these linked issues as a whole. Of course they come from different backgrounds. We find ourselves in these situations—originally I had written "wandered into these situations"—for different reasons, but the situations are related. My worry, based on some experience, is that the more difficult the issues in each case, the more short-term will be the consideration of those issues. That is the first point on which I would like some reassurance.
	It is easy to oversimplify—we all do it all the time—by trying to fit all these situations into one category. Some talk about them as part of the war against terror, the struggle for energy, the battle against tyranny and in favour of democracy, or the clash of civilisations or religions. All of those are elements. Just as the countries and situations are geographically linked, so are the elements within them. But we can only conclude, I believe, that we find ourselves in a thoroughly dangerous situation. It is dangerous for British troops, dangerous for British interests and dangerous for the peace of the world.
	The handling of that situation, looked at as a whole for a moment, will require exceptional skill from the Government. It will involve disposing our Armed Forces, which are second to none in skill and, where necessary, cunning, and diplomatic and intelligence services, which have a high and deserved reputation. But all that depends on skilled, clear leadership from the Government. I hope that the Government and all of us will not be ashamed to learn from some mistakes of the recent past. Above all, I urge that this time, across the whole range of linked issues, we get our facts straight and put them plainly to Parliament and the public.
	I have a special reason for making that last point. It is very hard, even for those of us who try to follow these matters, to follow them successfully and to discover what is happening on the ground in any of these areas, but particularly in Iraq, Iran and Afghanistan. The media—this is entirely understandable and many of us have discussed it with journalists—are hugely concerned partly with the expense but overwhelmingly with the danger of sending people to cover these situations. That is particularly true in Iraq. It may well become true in Afghanistan, and there are different difficulties in Iraq.
	The result is that there is no continuous thread of reporting in our newspapers. I find that I have to read the Herald Tribune or the Wall Street Journal—American newspapers—to get anything like a continuous thread of reporting. It is as if we are passengers in a vehicle driven by Ministers, as is right, but we are to some extent blindfolded. We therefore rely, more so than in other issues, on Ministers to see clearly and to have our confidence won as passengers by what they tell us. That is a big responsibility on government and it applies in these situations even more than usual.
	On Iran, it seems to me that the Government must be right in opposing further proliferation in principle, and in this case in particular, and that they are right to distrust the assurances of a regime which is undemocratic, oppressive, unreliable and a friend to terrorism. They have also been right to build up pressure on that regime through mobilising diplomacy, and they have been right in their tactics. They have been right to join our European partners; the Foreign Secretary has been right to take the initiative with his colleagues in France and Germany; they have been right to get the approval of the European Union as a whole; and they have been right to set off down a diplomatic path. I believe that that will increasingly be the pattern for the future—for example, in our relationships with Russia.
	We have a choice as Europeans. There is no compulsion and no treaty obligation but there are shared analyses and shared interests, which I believe increasingly will lead us, as in this case, not to squabble and fly off in different directions, as we did over Iraq, but to come together and work together.
	The other big difference over the handling of Iraq is that this European effort is in partnership with the United States. European diplomacy was first accepted rather sceptically and grudgingly but then warmly welcomed by the United States, and it is now part of that country's policy. This is the United States in the second term of President Bush. The rhetoric and the speeches are broadly the same—there is a continuity—but the practice is different. I have seen it described in one newspaper today as "neo-realism", following the neo-conservatives. It is the rediscovery of diplomacy, and perhaps it is the State Department reasserting its control over foreign policy.
	The first phase of this diplomacy, based on the IAEA, ended without agreement. That is not particularly surprising because I believe that we are in for a very long haul. But the achievements have occurred through the IAEA conclusions about the concealment and non-compliance practised by Iran. Those conclusions, and the endorsement of them by a wide range of the international community and, now, the acceptance that there needs to be a transfer of the discussion to the Security Council and acceptance even by Russia and China, are important, although limited, achievements. Now there is a pause until March and then the Security Council will discuss the matter. Again, there is a big difference between what one might call Bush 1 and Bush 2. There is no longer scorn of the Security Council but a reliance on it.
	The pressures build on Iran, but I believe that they will take a long time to build effectively. Can the Minister tell us something about the status of the Russian proposal to enrich uranium for Iran in Russia? Is that acceptable to us or to the United States? What are the prospects for it, and what is Iran saying about it?
	I should mention sanctions because that issue is in the background of both this debate and the Security Council debate. I shall not press the Minister for details, but I hope that the Government will be calculating what might do some good, what might increase the pressure and what the traffic in the Security Council is likely to bear. The United States already applies extensive sanctions to Iran because of history. What would therefore be involved is the Europeans, Russia, India, China and so on joining in some of those sanctions to help build up the pressure.
	Perhaps I may say a word about the use of force. There are always bellicose journalists who urge us to bring on the bombers, but I think that everybody, including those in Washington, is fully aware of the grave risks involved. It may be tempting to speculate on a focused attack just on nuclear installations. However, we know from Iraq that there is no such thing as an attack that is so focused that no innocent people are killed. Any such attack involves killing considerable numbers of innocent people. I am not qualified to comment on the technical possibilities of a focused attack on nuclear installations, but such an attack would leave an untouched, angry and revengeful government in Tehran with probably a united people behind them. That would be true whether the United States or Israel launched the attack. An attack by Israel would be regarded—accurately, to a large extent—as a joint effort with the United States.
	I have not seen the next point made before. However, Britain would be vulnerable in the above situation. We have chosen to station our troops, in modest numbers, whether in southern Iraq or southern Afghanistan, where we are uniquely vulnerable to this kind of retaliation from nearby Iran. We cannot realistically and for ever rule out the use of force. If the regime in Iran or its successor moved from words and piled up an unmistakable danger, I do not think that we could entirely rule out the use of force. But we should not deceive ourselves that we can have some sort of strike without a war, or some sort of war that does not involve huge dangers and damage and many, many thousands of casualties, our own and Iranian.
	I should say something about democracy and the attitude and appeal of the President of the United States. In a way his appeal to the Iranian people was similar to the appeal to the Iraqi people. But there is a difference. Saddam Hussein and his family were corrupt and self-seeking and built palaces as part of the parade of power. In Iran we are dealing with puritanism as well as patriotism. President Ahmadinejad appeals to the poor, dresses simply and behaves simply. He has the same sort of appeal as Hamas on the West Bank and in Gaza and as the Muslim Brotherhood in Egypt. We should not neglect the importance of the puritan appeal in an area of the world that is marked by such glaring inequalities.
	Patriotism is also important. Iran is an ancient country with a huge history of which it is very conscious. This is more than simply a platitude for after-dinner speeches; it is a relevant political fact. We have forgotten so much of our history and, in a way, the Iranians remember too much of theirs. They remember past glory; they remember humiliation—at our hands, Russian hands and American hands; and the coup of 1953 against Mossadeq—things which we never knew or have forgotten. Out of this comes a deep reluctance to be told by other people how they should behave.
	I will not deal with the question of exiles and the rights of the PMOI because other noble Lords will make that point. They may be right in urging the deregistration of that organisation from the terror list. But I do not believe that we can say that exiles from abroad hold the keys to the future of Iran. We made that mistake in Iraq and I do not think that we should repeat it, however admirable and brave these people should be.
	We need to build up the pressures, but also to indicate the rewards. An Iran which accepted to forswear military power; recognised the need for peace with Israel, as all the Arab governments do, and had decent respect for human rights—that Iran—should have a notable part in deciding the future of the Middle East and the security of the Gulf. Arab countries are already beginning to talk about the possibility of observer status for that sort of Iran. We should say this now so that it clearly sees both the pressures building against it if its increasing isolation continues, but also the rewards available if it takes the other course. The pressures are inevitable, and we should build them up, but the rewards should be evident. That requires patience. And patience, in the rather hectic, media-driven world in which we live, is often mistaken for weakness. I am clear, however, that patient strength is the only way in which to see our way through these great dangers. I beg to move for Papers.

Lord Temple-Morris: My Lords, I thank the noble Lord, Lord Hurd of Westwell, for giving us the chance to debate Iran at a very topical and relevant time. I congratulate him on the way he has introduced the debate, and I shall be referring to many of his points as I go along. He is aware of my long-time interest in Iran, and I am only too well aware of the balanced and knowledgeable way that he dealt with Iran, often in difficult times, when he was Foreign Secretary.
	First, by way of a declaration of interest, I have never had, and do not have, any financial interests in Iran. There is a personal interest, however, in that I have been married, if not to the country, to one of its former citizens for 41 years. I am the president, and have been for some years, of the Iran Society. I was an officer, mainly chairman, of the British-Iranian All-Party Parliamentary Group in this building for 31 years; I resigned from that office, while in this House, together with a number of other offices to do with Iran—keeping the Iran Society, which is purely cultural and non-political—because of my deep reluctance to have anything officially to do, as a Back-Bench volunteer, with the present regime in Iran.
	By way of background—the noble Lord, Lord Hurd of Westwell, has touched on this—we are dealing with an old civilisation and a very fine people who have been grossly abused by various rulers and invaders. Over a couple of thousand years, they have developed a psyche of weathering the storm, and absorbing the ways of the invader. That has led, in order to survive, to their wanting to be told what to do, and even an expectation that others will do it for them. That gave us the vulnerability which led to the tragic Iranian revolution of 1979. The net result of that revolution, and the psyche of the people, was that the only two organised elements at the time took control: the mosques and the secular Left. I mention this because it is relevant to what we do in the future.
	After the revolution, there was a particularly vicious and nasty civil war between 1979 and 1983. The secular Left, in the form of an organisation that exists now—the People's Mujaheddin of Iran—lost out and eventually left the country in 1983. Before, during and after the war, it suffered persecution of monumental and extremely unpleasant proportions, which extended to its female as well as its male members.
	The United States took the wrong approach to the present situation. It tried to isolate Iran from an early stage, which made the situation worse. It failed to support elements in Iran which could have made more of a difference then than perhaps they can now. It is a sad precedent that when a country such as America, much as we love it, is expelled from a country—for example, Cuba—it finds it difficult to forgive.
	Europe is just about as united as it can be over Iran, but we are for ever in commercial competition within Iran and we are not strong enough on our own, without the United States, to make a real difference. Russia is heavily involved commercially in Iran, particularly in its nuclear industry. It will, I think, play it both ways and end up profiting out of Iran. China, which is on the wings, has made a speciality of getting into many countries with which the West is in difficulty or is leaving. In such cases, it does not, I am afraid, care very much about the nature of the regime. Finally, let us not forget India. India has an awful lot to gain from Iran. Its outlook, subject to international public opinion, will be commercial.
	Internally, Iran is in a mess; it is in an economic and political mess. It has more than 60 million people. It cannot provide jobs for its youth. It has an Islamic government. Nobody is really in power—a different answer here, a different answer there, but with one important exception: internal security. It is completely dependent on its oil, gas and natural resources. It has a bad infrastructure. Its aeroplanes crash; its lifts do not work. I could continue in that vein. Its non-oil exports are minimal. Tragically, it has made a mess even of its caviar industry. It is dependent on the West for consumer goods. Noble Lords will perhaps have a different view, but the East will not be able to replace the West in a country which has always leant towards the West and will continue to do so. It is nonsense to think that the West needs it more than it needs us. We need its oil, but it needs the money with which we pay for it.
	Iran presents certain problems for us, the first of which is the nuclear issue. I am convinced—the noble Lord, Lord Hurd, has already mentioned it—that it is going for a nuclear bomb, and I am equally convinced that it cannot be trusted with it. This leads to the seriousness underlying this debate, as has been said.
	Terrorism has largely been limited so far to Arab-Israel, to Hezbollah and to Hamas, but some serious meddling in Iraq does not augur well for the future. British lives have been lost because of it. So it is a serious situation. If there was a military strike in whole or in part on Iran, the potential terrorism that would come out of Iran would dwarf anything that is happening in Iraq, however ghastly that might be.
	We need to strike a balance between pressure and maximum sanctions and isolation. Isolation is dangerous and unpredictable, but pressure remains relevant. People will argue for dialogue. I have spent 26 years since the Iranian revolution indulging in dialogue with Iran. I am quite convinced as a result that it will not genuinely engage and that it will play for time. I have already mentioned its vulnerabilities: the economy, infrastructure and population. We must support dissidents within and outside Iran. They expect it and they want a lead on it. Secondly, we must continually expose—and not just in a little resolution in some UN committee—its atrocious human rights violations. We must support protestors within the country all the time. A recent strike by bus drivers in Tehran and its repression was largely ignored by western media in spite of appeals—particularly to trades unions—to help. That is an example of something we should take action on.
	Finally, one thing will really hurt and will illustrate where the Government stand. I have thought a lot about it, and I have never advocated this before. I dealt earlier with the civil war in Iran after the revolution. To de-proscribe the People's Mojahedin Organisation of Iran—which has never been a terrorist organisation as far as this country is concerned and has a perfectly respectable political wing—as a terrorist organisation would be the biggest signal that could be sent. Dialogue is no longer a priority; action and pressure are. In bringing action and pressure, we have to encourage the Iranian people, not the administration, because, at the end of the day, only they can do it.

Baroness Royall of Blaisdon: My Lords, may I remind noble Lords that this is a timed debate? Each noble Lord has seven minutes and if he goes beyond seven minutes on the clock, he is into his eighth minute. Every minute we go above detracts from the time that the Minister has to respond.

Lord Chidgey: My Lords, I shall keep that remark in mind. It pays to put our relationship with Iran in some perspective. As has been said already, the Iranians are a very proud people. Through their history, they trace themselves directly to the ancient Persian empire. Indeed, they tell me that the collapse of the Persian empire, following its defeat by Alexander the Great, still grieves them to this day, some several thousand years later. So the injustices that the Iranians suffered at the hands of the United States and us over 50 years ago are as fresh and disturbing to Iranians as if they happened yesterday. Iranians remember well that in the 1950s, the United Kingdom introduced a two-year embargo on Iranian oil exports as a response to Mossadeq's socialist government nationalising the Anglo-Iranian Oil Company. They remember well that the United Kingdom, again in league with the United States, orchestrated the overthrow of their Prime Minister and the reinstallation of the Shah to counter the threat of Iranian oil and gas fields falling under the influence of Russia.
	When I visited Iran, I was amazed to find that it is one of the few countries in the world where the BBC is intensely distrusted. Iranians believe that BBC World Service announcements to Iran facilitated the regime change of Mossadeq. Again, they believe that the 20 million demonstrators who took to the streets against the Shah, which led to his fall, were mobilised through the BBC. That is what Iranians believe, and today they are still deeply suspicious of the United Kingdom instigating regime change from outside.
	Iranians look around and see the US and UK military presence in Iraq, Turkey, Afghanistan and the Gulf states. They are more or less surrounded. It is hardly surprising if Iranians consider that the pursuit of nuclear weapons as a deterrent to attack is the logical course. So how should we react? Clearly, threats of military reprisal could well be counter-productive. They could reinforce the inherent distrust and the hold that the regime has on the Iranian people through fear. They could encourage conservatives in the Iranian regime to pursue nuclear weapons development with all possible haste.
	Our intelligence services and other intelligence sources conclude that Iran is pursuing a twin-track programme: the legal development of nuclear-fuelled power generation as a substitute for gas and oil and the illegal development of fissile material for use in nuclear weapons—illegal because Iran is a signatory to the Nuclear Non-Proliferation Treaty. Intelligence sources have concluded that Iran is aiming to reach a stage when it can switch from civil nuclear power to include nuclear weaponry development in the shortest time possible. Iran's scientists and engineers are thought to be about five years away from producing Iran's first thermonuclear weapon.
	Clearly the West has to react, but surely not by attempting to repeat the type of regime change carried out in Iraq. Intervention must be under the aegis and through the authority and legitimacy of the United Nations. Any other route would surely lead to ever-greater and possibly catastrophic instability throughout the region.
	As a first step, the UN Security Council could condemn Iranian failure to comply with the undertakings that were given to the IAEA and demand compliance. The United Nations could follow up by authorising a number of actions to reinforce that compliance. It could, for example, seek UN oil sanctions. As has been mentioned, oil comprises 80 per cent of Iranian exports. It is unlikely to be easy to achieve this. China, for example, takes about a quarter of Iran's oil exports, and her burgeoning economy has a huge appetite for oil. Russia, too, is likely to object, and India, as has been mentioned, as well as Japan, South Korea, France and Italy are all major customers for Iranian oil.
	We could seek energy equipment sanctions through a United Nations Security Council prohibition of the transfer or sale of oil and gas technology to Iran. That is a smart sanction, and could be a significant move that affected the regime more than the Iranian people. Again, however, it could be difficult to get agreement, given Russia's energy interests. Are military strikes a contender? Under Chapter 7 of the UN charter, the UNSC could authorise a strike against military targets, but that is extremely unlikely. Military strikes by the United States, possibly backed by Israel, are perhaps more likely, but given the scale of the nuclear development facilities at Esfahan, it would need to go far beyond the concept of mere surgical or pinpoint strikes to be effective.
	The inevitable outcome of that would surely be a large number of civilian deaths, and Iranian military conventional retaliation against Israel and US and United Kingdom assets in the region. Are we ready for that? It could also mean the destruction of the ancient capital of Esfahan, founded by Shah Abbas the Great in the 16th century. A world heritage site sits on the crossroads of the ancient silk caravan routes. Are we prepared to commit that destruction?
	There needs to be a change in the political climate in Iran to encourage policies and initiatives that are not based on the presumptions of external threats and duplicity. In that context, the use of external agents to instigate internal regime change is clearly a non-starter. The Iranian regime is under internal pressure to change. The population has more than doubled since the revolution. The young people are vastly in the majority, and they are pressing for greater social freedom and economic opportunity, but external threats, implied or direct, allow the Iranian Government to suppress the call for change by prioritising the need to defend Iran from external attack. While the Iranian regime can mobilise public support in defence against threats from the West and thus justify harsh restrictions on civil liberties, reform will be slow.
	Finally, there needs to be a clear demonstration from the United States and us that, through compliance with the IAEA, Iran need not be under military threat. We could start with a security guarantee to Iran from the United States and continue with a commitment in the longer term to the creation of a nuclear-free zone throughout the Middle East as an extension to a successful peace process in which Iran could play a prominent role. I fear, however, that that is a long haul indeed.

The Lord Bishop of Rochester: My Lords, in the debate today, many will rightly focus on the political situation in Iran—some have done so already—and on its implications for the region and for the world. Iran's relations with her neighbours, the confrontational situation with Israel and international unease about Iran's nuclear ambitions are all causes of significant concern.
	A number of people in this Chamber can address these concerns better than I can. I am sure that they will do so. Indeed, they have done so. I wish, however, to draw your Lordships' attention to some features of the situation which should not be forgotten. The first is that Iran is not only a revolutionary Islamic republic. As has been said, it is the bearer of an ancient and dynamic civilisation which predates the coming not only of Islam but of Christianity. It has also had a hugely creative relationship with Judaism. The remaining Jews in Iran are a legacy from the time of Queen Esther.
	This civilisation has its own sense of history, its own literature—historical, poetical, scientific and theological—and its own culture. Nor have the people of Iran always been victims of invaders. They have sometimes been conquerors of other parts of the world themselves. The relationship of that complex heritage to Shi'a Islam is not always straightforward. It is largely awareness of that civilisation that distinguishes Iran from its Arab neighbours. As a factor in the national consciousness, it should never be underestimated. It would certainly play an important role in the cultural and spiritual renewal of the Irani people.
	Secondly, there is a great deal of ferment in Iran; that has been hinted at already. There is a spiritual hunger and thirst that is not being quenched and that continues to seek freedom for the spiritual quest. Young people, who are by far the majority, are dissatisfied with the artificial constraints imposed on their access to knowledge, entertainment and current affairs. They wish to be treated as adults in terms of their relationships and are looking for trust not for repression. It is difficult to see how any regime can indefinitely hold back the tide for change.
	Thirdly, the ulema or the fuquha, the religious scholars themselves, or at least some of them, are opening up to the outside world. In Tehran, Qorn and Meshed, they are studying, translating and commenting on contemporary philosophical, literary and theological movements and works. There are projects for translating the works of western theologians, for instance—people of other faiths—and there are regular programmes for inter-faith dialogue. In the past week we have seen the dangers of caricature all too clearly. We must not succumb to that tendency but evaluate carefully where such intellectual activity is leading and what impact it will have in the long run on that nation's life.
	Music, poetry and film continue to flourish even in post-revolutionary Iran and are often the vehicles for social comment and political criticism. Any policy of exchange will need to support the recovery of Iran's ancient heritage. The work of the British Institute of Persian Studies has been second to none in that respect and I hope it can continue. The young need to be encouraged and the religious scholars supported in their wish to widen their horizons. Whatever happens politically, we must make every effort to continue and increase academic, cultural and religious contacts.
	I make a final observation: the United Nations and other monitoring agencies have consistently singled out the parlous state of Iran's religious and ethnic minorities. Their freedom is in many cases significantly restricted. Their properties have been confiscated and they live in constant fear of being reported to the Basiji, or revolutionary guard. Their survival and welfare should be in our minds when we consider the political options.
	We pray that Iran will, once again, attain greatness not on the basis of its military power but because of the sensitivity of its people, the scope of its art and literature and the sweetness of its language. We pray that it will be once more a respected member of the international community and that it will make its own special contribution. As an Iranian poet has said,
	"Iran Khudaya bar zamin, dar har Zaman azad bad
	Kuh o dar o dastish hami, az rachmata abad bad".
	He says,
	"Oh God may Iran be free in every age, its hills plains and forests flourish by your grace".
	I am sure we can all say "Amen" to that.

Baroness Gould of Potternewton: My Lords, I thank the noble Lord, Lord Hurd, for initiating the debate and for providing the opportunity to consider the position of human rights in Iran and the inclusion of the PMOI on the terrorist list.
	It is just about a year since I spoke at a symposium of parliamentarians and jurists calling for the removal of the PMOI from the terrorist list. I said then that I hoped that the following year would be the year in which a dark and brutal chapter in Iran's proud history would close and a new dawn would begin. But what is the reality? What has happened since? As we speak, Nazanin, an 18 year-old Iranian girl, languishes in solitary confinement in a Tehran gaol, counting down the last days of her short life. Nazanin has been sentenced to death by one of Iran's Islamic courts. She was accused of killing the man trying to rape her in a park in Tehran when she was just 17 years old. A weeping Nazanin told the religious judge that she and her 16 year-old niece were attacked by three men who wanted to rape them. The judge accepted her account but nevertheless condemned her to death. This is the regime we are talking about.
	Nazanin's story is not an isolated one. Earlier this month, another girl, Delara Darabi, was sentenced to death for a crime she allegedly committed as a minor—a crime she absolutely denies. A particularly repugnant case is that of 16 year-old Atefeh Rajabi who, in August 2004, was hanged in public for what the religious judge described as "acts incompatible with chastity". He then personally put the rope around her neck.
	Since the new president assumed office—undemocratically elected by only 10 per cent of the population—150 men and women have been hanged in public in Iran. The total number of political executions in the past 26 years is believed to exceed 120,000, many of whom have been minors. Iran has one of the most deplorable records of human rights violations in the world. There have been no fewer than 54 UN resolutions condemning the ruling mullahs for their continuing grave violations of human rights. As has been widely reported by international human rights organisations, the government of the radical Islamic president has been stepping up international repression. Executions, arbitrary arrests and violent suppression of anti-government protests and strikes are on the rise.
	The nuclear danger can never be underestimated; it has to be one of our major concerns. But that does not mean that we should lose sight of the fact that millions of Iranians are living under this repressive and theocratic regime. From the onset, the president's policies have exhibited a volatile mixture of nationalism and radical Islamic social engineering. His language has been one of contempt for the international community and for religious and ethnic minorities; there has been xenophobia, anti-Semitism and an absolute rejection of compromise, so clearly illustrated by his vow to defy referral to the Security Council of his suspected nuclear ambitions.
	As is so often the case, women are the first victims of the renewed crackdown by the ultra-Islamic radicals. Earlier this month, the president's adviser said that plans to enforce gender segregation on Iran's pedestrian walkways were well under way. The official said that this was part of a government plan called "Enhancing the hijab"—that is the veil—"culture and female chastity". When the president was the mayor of Tehran, he ordered all buildings belonging to the municipality to have separate lifts for men and women. I assume those lifts were actually working.
	In Iran, violence against women has been legalised and institutionalised by the state. A recent study conducted by the National Welfare Organisation found that two-thirds of Iranian women are victims of domestic violence. Iran remains one of the only countries in the world where women are stoned to death. Last year, the UN Special Rapporteur for Violence Against Women, Professor Ertürk, chastised Iran over what she said were abuses and discrimination built into the Islamic republic's laws. She wrote in her report:
	"Iran's laws do not provide protection for victims of domestic violence and make it difficult to escape violence through divorce".
	She also said that suffering wives face time-consuming judicial procedures and stigmatisation.
	At the same time as condemning the Iranian regime, we should be offering our support to Mrs Maryam Rajavi, as did my noble friend Lord Temple-Morris, and the Iranian resistance for staying true to their goal of standing up for the basic rights of the Iranian people. As well as revealing to the world the mullahs' nuclear weapons programme, their terrorist atrocities carried out in various parts of the world and their interference in Iraq, the PMOI and the NCRI have been fundamentally the primary source of information concerning the Iranian regime. As the noble Lord, Lord Hurd, said, getting information is difficult.
	It is therefore a grave injustice that the PMOI should find itself proscribed and have restrictions placed on its activities. The placing of the illegitimate terror tag on the PMOI was an undeserved gift to the mullahs, as has been the policy of appeasement which only strengthens the mullahs in their abuse of human rights. It is about time that we stopped appeasing the mullahs. It is about time that we de-proscribed the PMOI. The proscription of the PMOI does not have the support of many hundreds of parliamentarians, British jurists or the British public. I believe that Britain is in a unique position to take the lead in launching a new policy initiative on Iran and forging a transatlantic consensus that will through a robust, creative and firm diplomacy prevent Iran's acquisition of nuclear weapons. I ask my noble friend the Minister whether the Government are prepared to take up that challenge.
	I end by doing something I never believed I would ever do—quote from an editorial in the Sun. It says:
	"Meanwhile, the EU has stupidly labelled the only effective internal opposition, the PMOI, as terrorists.
	The PMOI has never targeted the West. It publicly ceased attacks on the Iranian military in 2001.
	Foreign Secretary Jack Straw must today demand EU action to lift this crazy ban.
	And stop appeasing a regime that aims to hold the Arab and Western world at nuclear gunpoint".

Lord Waddington: My Lords, I, too, agree with the Sun on this occasion. I thank my noble friend Lord Hurd of Westwell for having initiated this debate. I am well aware, when listening to someone with his experience, how much I have to learn.
	I start with some facts known to us all. Few doubt that Iran is a sponsor of terrorism, retaining close links with the most notorious terrorist groups in the Middle East. Few doubt that it has been making trouble in Iraq. Few question that with the intensification of its efforts to acquire nuclear weapons, it is a threat to world peace. Few doubt that the regime is an evil dictatorship with complete contempt for human rights. But after the experience of Iraq, I doubt whether anyone yearns for a war launched by the US, Britain or anyone else to topple the regime. Most people want to see change—peaceful change, if possible—brought about by the people of Iran themselves. One would like to see the West pursuing policies which make such change more rather than less possible.
	I frankly admit that it is only comparatively recently that I have come to study these matters, and I repeat that I am no expert. Noble Lords will also appreciate that I am not automatically attracted to organisations with Marxist leanings. But I have come to the same conclusion as the noble Baroness, Lady Gould, and many others on all sides of the House. It is clear that the PMOI is a member party of the National Council of Resistance of Iran, which is an alliance of a number of parties, individuals and groups, acting as a Parliament in exile, calling for an end to the present regime, calling for free elections and a democratic state. As for the PMOI itself, it appears to be by far the largest and most active opposition movement in Iran, and before being banned by the regime in 1981, had half a million members.
	The US Congressional Research Service describes the organisation as,
	"a major opponent of the regime in Tehran, advocating democracy, human rights protection and free-market economics for Iran".
	Right now, the PMOI is active within Iran carrying out propaganda and political campaigns and it has proved itself the best source of intelligence about what is going on there. In 2002, it was the first to reveal Iran's secret nuclear sites.
	I pay close attention to the words of my noble friend Lord Hurd who doubts whether the exiles have the capacity to bring about change, but nobody has told me of any organisation other than the PMOI which offers any hope of bringing democracy to Iran. Nobody has told me of another organisation which also has broad support and which is also in a position to tap the huge discontent and yearning for change in Iranian society evidenced by the boycotting of the last presidential election.
	Back in 1997, America put the PMOI on its list of terrorist organisations. There is reason to think that that was not so much out of concern for the organisation's activities as to further a policy of rapprochement with the regime. The Clinton administration made what a senior US official described as,
	"a goodwill gesture to the new Iranian President Muhammad Khatami",
	and in March 2001 Britain followed suit, including the PMOI in a list of 21 organisations proscribed under the Terrorism Act 2000. I can well understand why that happened at that time, but the trouble is that by our actions against an organisation which has certainly never attacked western or British interests, we have been helping no one but the mullahs. By attaching the terrorist tag to the only organisation capable of opposing them, we have been legitimising their rule. We have enabled them to argue that, faced with what the West apparently recognises is a terrorist threat, they have been entitled within Iran to take stern, even brutal measures. And of course, proscription has certainly weakened gravely the ability of the PMOI to present its case in America and Europe. It has stopped it engaging in political activity to gather support and build up opposition to the regime.
	In those circumstances, I ask the Government to consider whether the time has come to take the lead in de-proscribing the PMOI. I do not accept that the PMOI was a terrorist organisation within the meaning of the 2001 Act. Its operations were carried out against the military targets of a tyrannical regime. In a sense, all that is beside the point, as one can see from reading the debate in 2001. On that occasion, the Home Secretary was at pains to point out that, even after having come to the conclusion that a particular organisation is concerned in terrorism within the meaning of Section 3 of the Act, he had a discretion whether to list it or not. One can see why. If the powers in the Act had existed in 1938 and the British government of that day had sought to use them to proscribe an organisation bent on using violent means to rid Germany of the Nazis, I like to think that the government would have been condemned by every decent citizen.
	The parallel is obvious. So long as we continue to proscribe the PMOI, we undermine and weaken the principal opposition to a regime whose continued existence is certainly not in our interests. We make it easy for the regime to brush aside the so-called reformers in its own ranks and enable them to give the impression to their own people that the West, if not on the side of the regime, is against those who oppose it. We are helping to prop up a tyrannical regime with a complete contempt for human rights. If on the other hand we de-proscribe the PMOI, we will be signalling support for the democratic change in Iran which we surely all desire.

Baroness Williams of Crosby: My Lords, I do not propose to follow the noble Lord, Lord Waddington, by talking a great deal about the PMOI, partly because I think it is a difficult problem. I issue one note of warning: after our experience in Iraq with Mr Chalabi and his associates, one should be careful about treating the evidence of exiles as full proof of the position that they hold. There are often people with strong interests, not least in Iran, in retaining what was, in the past under the Shah, a pretty feudal regime. One has to bear that in mind in deciding whether to support a particular group of people who are essentially associated with the families that for so long ran Iran.
	The noble Lord, Lord Hurd, was wise to say that there is a certain appeal, not least in the Middle East, to people who exercise a puritanical attitude towards their own enrichment. In a world where corruption is profoundly known, it is important to notice that somebody will attract support simply because they live in an austere way and appear to be still a man of the people. While I in no way condone the terrible human rights abuses that have occurred in Iran—the noble Baroness, Lady Gould of Potternewton, was absolutely right in what she said, not least about the dreadful position of women in the country—we have to be careful in simply dismissing the appeal that the president and those around him may have at the present time to many Iranians who over the years have felt profoundly exploited and maltreated by the West.
	In that context, I add one thing to what the noble Lord, Lord Chidgey, said, because it is often easy for us to forget these things. There was Mossadeq, there was the Shah himself who to a great extent was imposed upon the country, but we should not forget that the most dreadful war of recent times in terms of the loss of young men was the Iran-Iraq war. The level of casualties in that war was equivalent to the First World War in Britain or France; it was the sacrifice of a generation. That generation was mostly sacrificed to arms and weapons provided to Iraq by the West, particularly by the United States, in order to defeat and weaken Iran. That is not long ago, it is a recent memory and feeds deeply into Iranian paranoia about the West—a paranoia which is not, alas, entirely a fantasy.
	There are a couple of things about the approach that we might now take, by way of one other observation. The West has supported the whole architecture of nuclear non-proliferation with its words, but not, alas, with its deeds. As recently as last spring, there was an attempt to reject the comprehensive test ban treaty, specifically because there was an attempt by the first Bush administration—I agree with the noble Lord, Lord Hurd, that the second administration has learnt both patience and wisdom—to escape from the treaty, to talk about bunker busters and a new generation of nuclear weapons, and to flatly refuse to carry out the responsibilities of the nuclear powers towards sustaining the non-proliferation treaty. We ourselves have gone a long way to undermine the strength of that architecture. We have to answer in part to ourselves for the way we in which we weakened the non-proliferation treaties.
	Colleagues in this House may recall that as recently as 19 January of this year, President Chirac had this to say at the appropriately named Finistère base of the French armed forces:
	"in the face of the concerns of the present and the uncertainties of the future, nuclear deterrence remains the fundamental guarantee of our security".
	It is phrases and thoughts like that that clearly feed the Iranian belief that they too should protect their security, surrounded as they are by many hostile states. It is worth adding that they have noticed that both India and Pakistan, after a great deal of world furore as they reached the point of becoming nuclear powers, became quite acceptable to the international community having become nuclear powers—in the teeth of the IAEA and of the UN regimes to prevent proliferation.
	What might be done about all this? I echo the noble Lord, Lord Hurd, in asking about the Russian proposal to deal with the enriching of uranium and to then supply Iran. I understand that the first reaction to that was one of rejection by the Government of Iran, but it is the one show in town that may have some life in it. The fact that Russia has a $1 billion development contract with Iran to develop the Shahab nuclear missiles—the missiles are not currently nuclear but could become so—is serious, but it gives Russia a disproportionate amount of influence. India also has great influence, and has so far not been brought into the discussion about Iran's position.
	Lastly, what early hints were there in the beginning of the diplomatic minuet with Iran that there might be some possibility of discussing a non-aggression pact in the Middle East? There is a problem; Israel is a nuclear power at the present time. In looking more widely at the position of the region, as did the noble Lord, Lord Hurd, in introducing this fascinating debate, there is a real possibility that a non-aggression pact linked to a slow-down and, eventually, to a nuclear-free zone in the Middle East might get us somewhere. Iran has to be persuaded that she is not going to be attacked out of the blue in the way that Iraq was, and she has to be persuaded that a response to that by either sanctions or, worse, the loosing of terrorist forces over the whole of the region would present the whole world with a catastrophe, and one that would exact a colossal price from us all.
	To conclude, one line that we might pursue was eloquently and beautifully expressed by the right reverend Prelate the Bishop of Rochester. We should stop to think for a moment whether Iran might be at least as well approached by an attempt to build up an inter-faith dialogue, given that its council of guardians are the people who actually run the place, than by the conventional methods of politics. I agree with what the right reverend Prelate hinted at: through theology and culture we may begin to establish the kind of links with Iran that one day may bring about the change that all of us want to see—the enlightenment in that remarkable civilisation.

Lord Hannay of Chiswick: My Lords, it is well over two years since this House debated, through an Unstarred Question that I put on the Order Paper, the question of Iran's relationship with the international community. It is thus timely that, on the initiative of the noble Lord, Lord Hurd, we should return to the subject now—all the more so because the relationship has not evolved positively, as was then hoped; quite the contrary.
	The EU3's efforts to agree with Iran the objective criteria necessary to alleviate legitimate concerns about that country's nuclear programme have met with a frustrating combination of prevarication, evasion and the reversal of commitments to suspend all work on uranium enrichment. At the same time, the new president of Iran has fuelled international concern with a series of bellicose statements, in particular about the state of Israel, which would be unacceptable in the mouth of any head of government but which are all the more alarming coming from one whose country's nuclear programme cannot yet be demonstrated by the IAEA to be exclusively peaceful in nature and which possesses a sophisticated missile capability. It seems entirely appropriate that this matter should now be reported to the UN Security Council and quite unreasonable that Iran should consider such a report as being in some way a hostile act for which it is not wholly responsible.
	What is the course of action in the Security Council most likely to secure the objective we all share—including, purportedly, the Government of Iran—of certainty that Iran's nuclear programme is and will remain exclusively civilian? As a first step, I suggest that the Security Council should clearly set out what is required of Iran to achieve that objective and what is needed to avoid a situation in which the further pursuit of Iran's nuclear programme might be considered a threat to international peace and security.
	A complete cessation of all enrichment activities, whether research or production, is surely an essential part of this, not because it is a legal requirement under the non-proliferation treaty—it is not—but because Iran's long-standing clandestine activities in this field, including the purchase of technology from Pakistan, taken together with the better understanding that we have now of the scope that uranium enrichment production capacity provides for a country to switch to a military programme, makes it essential. Similarly, Iran's continued acceptance of the inspection regime provided for in the Additional Protocol will be essential. In return, Iran has the right to get absolute guarantees, but no obstacles will be put in the way of the development of a bona fide civil nuclear programme. In the short term that may best be achieved by the Russian offer of enrichment services; in the medium and longer term, and to counter Iran's claims that it is being treated discriminatorily, I would believe that we need a general system of international guarantees of enrichment services operating through the IAEA. This proposal was put forward by the UN Secretary-General last year on the recommendation of the high-level panel, and it seems to be gaining a wider degree of international support. I would be grateful if the Minister would tell us whether the Government are yet ready publicly to throw their weight behind it—and, if not, why not.
	There is much talk of sanctions against Iran, and it may come to that; but it should surely do so only if Iran refuses to co-operate or endlessly prevaricates over fulfilling what the Security Council states is essential, or if it continues to reverse its policy of full co-operation with the IAEA. The most effective sanction is the unity of the international community. The Government have done well to secure the agreement of the five permanent members of the Security Council on the need for the IAEA to report on this matter to the Security Council. It will be of the greatest importance to maintain that unity. Of course, if the price of unity is inaction in the face of Iranian refusal to co-operate, that would be too high a price to pay. But patience and perseverance are more likely to produce results than pressure for immediate action on sanctions.
	I also believe that we have to look wider than the nuclear issue in isolation, if the drift away from diplomacy and towards coercion is to be halted. Iran does have legitimate security concerns and, while it is not legitimate for it to develop nuclear weapons in response, it has a right to expect those concerns to be taken seriously. It is surely high time to begin exploring more actively whether the establishment of some regional security institutions, based on co-operation between the three main powers in the Gulf sub-region—Iran, Iraq and Saudi Arabia—could provide part of the response to those concerns.
	It is also an inescapable fact that Iran has security concerns about the intentions of the United States. While I welcome the much strengthened US support for the efforts of the EU3, I cannot see how those concerns can be addressed or dissipated without some direct contact between Iran and the United States. If the US can talk to the North Koreans and discuss its security concerns, why is it so inconceivable that it should do so to the Iranians? If bilateral contact is unacceptable, perhaps a group of which the United States could be a member could take up a dialogue.
	It is clear that we are going to have to live through a considerable period of heightened tension between Iran and the international community. It is important that the EU3 continues to pursue a coherent and flexible strategy—one that combines firmness over the nuclear issue with a willingness to look beyond that to a prospect of enhanced co-operation. So far as Iran's internal politics are concerned, recent developments cannot but be a serious discouragement to all who want to see a fully democratic Iran, in which sectarian and ultra-nationalist views no longer determine Iranian foreign policy. But it is for Iranians themselves, and not for us, to seek to bring that about. Loose talk about regime change is liable to be counter-productive, merely strengthening the hand of those in power and encouraging the very policy options that we are seeking to avoid—just as bad as public discussions of military options. Of course these do exist; it would be na-ve in the extreme to suppose otherwise. But it is surely right to make it clear at every stage and to every interlocutor that the policies that we are pursuing are to be achieved by diplomacy and peaceful means and not by the threats of force.
	Finally, I make a plea as someone who began his diplomatic career 45 years ago in Tehran. We must really try to put ourselves in the shoes of the Iranians and to understand their thinking. It would be quite wrong to suppose that this is exclusively conditioned by religious extremism. Some of the things that President Ahmadinejad says could just as well have been said—indeed, they were said—by Prime Minister Mossadeq in the 1950s. Iran's experience of being pushed around and manipulated by the great powers is a long and bitter one. We need to appeal to the pragmatic instincts, which exist in every Iranian whom I have ever known and to avoid playing to those memories of earlier defeats and humiliations. To coin a phrase, we need to show them respect, even when we disagree with them.

Lord Anderson of Swansea: My Lords, I follow and adopt the wise and measured words of the noble Lord, Lord Hannay, and particularly the appeal to see ourselves as the Iranians see us. I also congratulate, as have other noble Lords, the noble Lord, Lord Hurd, on his initiation of this debate and on drawing attention to the grave and in some ways urgent nature of the question. It is a test for us all of the limits of soft power and hard power.
	When the Foreign Affairs Committee in another place published its report on Iran in March 2004, we began by stressing the geo-strategic significance of the country, surrounded by volatile neighbours, and with substantial oil and gas reserves and a large population, as well as the positive contribution Iran could make to vital UK interests—the Middle East peace process, the war on terror, Iraq, and the drug supply, on which we have co-operated very closely with Iran. Our conclusions appear today somewhat optimistic in the light of the wild rhetoric of President Ahmadinejad and Iran's conduct on the nuclear issue. But our broad conclusions remain valid. Iran is a powerful country. The balance of regional power, after the fall of Saddam Hussein, has swung decisively in its favour. It makes sense to co-operate in areas of mutual interest such as drug control. Now, however, the nuclear problem puts all others in the shade.
	Dealing with that issue requires an understanding of the history of Iran, the motivation of its leaders and the complex dynamics of the parallel power structures. In particular, we should ponder where each step that we take along the road may lead, what is our end game and the attendant dangers to regional and indeed world peace. The deal brokered by the EU3 in autumn 2003 was hailed at the time as a triumph of EU diplomacy. Indeed, members of the Foreign Affairs Committee were there at the time of the deal. It certainly bought time in which other key countries, such as Russia and China, came to recognise the dangers. The question remains whether it has been wholly played out or whether parts, such as security guarantees—the attempt to address the real security concerns of an encircled Iran—can profitably be revived.
	The US for historical reasons has been more sceptical, and its rhetoric, such as "axis of evil", and even the later State of the Union message on encouraging internal opposition, has been shrill and counter-productive. Ultimately, however, historians may conclude that the West was indeed deluded and that Iran's aim has been consistent—the development of military nuclear capability. This aim has been fuelled in part by recognition that if Iraq had nuclear weapons the coalition would not have invaded it and by perceived double standards in the West. Now Iran is emboldened, made more confident by the problems of the coalition in Iraq, by the rise in oil prices which has bought new dependencies from other major countries—new friends in India, China and Russia—and by technical help from Venezuela and missiles from North Korea.
	What is the evidence of its intention of developing a military nuclear capability? There is the 18 years' history of Iran's duplicity; the fact that oil- and gas-rich Iran does not need civil nuclear power and the discovery of weapons-grade uranium traces at Natanz with implausible explanations on the Iranians' part. There is the hampering of IAEA investigations and the rejection, so far, of the Russian offer to enrich uranium in Russia, under Russian supervision. What is the current status of the IAEA initiative for an international fuel bank, under its management, to guarantee supply to countries like Iran? What is the Government's best estimate of when Iran is likely to have enough material to make a nuclear bomb, and how dangerous would it be if Iran obtained nuclear capability?
	The rhetoric of their president is alarming, with the intent—and, potentially, the capability—to destroy Israel, together with links with terrorists groups that could lead to those groups obtaining dirty bombs. That would destabilise the wider region, including Saudi Arabia, and undermine the non-proliferation treaty with no consensus for replacement. The key questions are: what is to be done next, and where would different responses lead? The military option—that is, selective strikes on nuclear sites—has been raised. Potentially, that could be technically feasible in the short term. Yet the recipes and research scientists are there, and it would be realised at considerable political cost.
	Is there any life left in the diplomatic track? It is certainly vital to follow solely the UN route and to keep Russia and China on board. It has been a miracle of diplomacy that they have indeed joined the international consensus. Are there incentives such as security guarantees which could even now divert Iran, which sees itself as surrounded by US forces?
	Clearly, and to conclude, we need a twin track. We should continue to explore whether there is any realistic prospect of a deal including security guarantees and with enhanced technical and commercial co-operation as rewards. As other noble Lords have said, Russia is the best hope of providing a deus ex machina, the way out of such problems in classical tragedy. At the same time, while recognising the difficulties of reaching a consensus on sanctions—those that we mentioned as being mostly relatively ineffective, such as football sanctions—we should make clear to Iran that there is indeed a price to pay if it fails to respond and that penalties would increase incrementally to international isolation.
	I conclude that the task is formidably difficult and that we may fail, with frightening consequences for regional and world security.

Lord Blaker: My Lords, I too want to thank my noble friend Lord Hurd for initiating this debate and for laying a basis for excellent debate with his excellent speech. I am sorry that he is not in his place at the moment, but I am sure all noble Lords will agree with that.
	The Iran crisis is more serious than the Iraq crisis, for three reasons. There is a greater and real danger of nuclear proliferation; there is, I believe, an increased hostility among Middle Eastern countries toward western countries, generated by the Iraq war; and, if the Iran crisis ever led to military action—which I hope it will not, yet we cannot rule that out—it is difficult to see where the necessary troops could be found among the coalition countries. However, the situation is in one way better than the Iraq crisis was, in that the European Union countries are now working together. They are now also working with the United States.
	I want to refer to one lesson from the Iraq story that is relevant in this situation and in other international problems which may face us, which is that we should be ready to put our views strongly to the United States. I am a great supporter of the American alliance, and have been all my life. However, one serious aspect of the Iraq crisis was that the Prime Minister clearly failed to put our views and interests strongly enough to the Government of President Bush. Indeed, we know that he and President Bush made an agreement 11 months before the war began, supporting the idea of war in principle. I have no idea what persuaded him to do that—his wish to be popular, I suspect—but that was a great pity. We have greater experience of the Middle East than the Americans, who should have paid greater attention to our views.
	I believe that the United States expected to be welcomed in Iraq and that their troops, when they got there, would have received the sort of reception they had in France in 1944, with flowers and joy. They expected the situation in Iraq to be peaceful, which it turned out not to be. I remember hearing a powerful speech just before the beginning of the Iraq war from my noble friend Lord Jopling, who is not here today. He had been in Washington the week before and had had several talks with politicians and military people, and he made the point that there appeared to be virtually no preparation being given to what would happen after the Iraq war. That is what led to many of the disasters which have followed ever since. Have the allies worked out a strategy for the possibility that, for example, the Russian offer of enriching uranium may fail? What other strategy should then be adopted? I seek some reassurance on that, although I do not suggest that it is the only problem to be faced. I agree with the noble Lord, Lord Hurd, that we are in for a long haul.
	I turn now to Israel, which is very relevant to this situation. Israel is an important factor in the whole of the Middle East, and a matter of concern to almost every Middle Eastern country. We know that the new president of Iran made that extraordinary statement about wiping Israel off the face of the map. That hostility to Israel clouds and hampers all western efforts to encourage stability in the Middle East. What is required is for the United States, which alone can do this, to put pressure on Israel to follow the road map. I mention pressure on Israel; although the Palestinians also need to do things, at present I want to draw attention to the importance of pressuring Israel to move forward.
	I also want to ask about the Russian suggestion for enriching uranium on Iran's behalf, which has already been mentioned. I agree with the noble Lord, Lord Hurd, that one cannot rely on the British media for information on such matters. He mentioned being informed by reading papers from New York, or other American papers; we are badly informed on that matter and I would like to hear from the Minister where it stands.
	Lastly, I want to reinforce what has been said by a number of noble Lords about the termination of the proscription of the PMOI, which seems to be extremely desirable in the present circumstances.

Lord Phillips of Sudbury: My Lords, I am grateful, as all of your Lordships are, to the noble Lord, Lord Hurd, for introducing this debate and to the Opposition for giving it time. My own engagement with Iran goes back a long time; I had a month there in 1961 and I may be the only Member of your Lordships' House to see the inside of an Iranian prison. In the light of some of the remarks about the present state of human rights and freedoms, I should say that there is a good deal of loss of memory or perhaps absence of awareness of what life was like in Iran before the revolution in terms of human rights. In my time there I was arrested by Savak, the secret police, on a number of occasions. It was a brutal, horrid regime of torture, denial of freedom of speech and all the rest of it—rather worse, as far as I can gather, than prevails today. Certainly, the press was not as free then as it is now.

Baroness Gould of Potternewton: My Lords, I thank the noble Lord for giving way, as I appreciate that this is a timed debate, but past bad human rights does not mean that we should tolerate bad human rights now.

Lord Phillips of Sudbury: My Lords, of course it does not. On the other hand, to try to discuss Iran without context, whether cultural, historic or regional, is a recipe for coming to the wrong conclusions.
	I have been back to Iran a number of times in recent years, including the visit by the parliamentary group in 2000—the first since the revolution. As president of the British-Iranian Chamber of Commerce, I returned there in 2004, trying to drum up an effective exchange of trade between the two countries. No one has mentioned that. We have good trade with Iran; it is too imbalanced for its good health, in that we export 10 times more to Iran than we import, but it is not insignificant to consider the role of trade in bringing about rapprochement, supporting progressive forces in that country and generally defusing heightened tensions. I strongly argue for that.
	I have a strong affection and admiration for Iran and its people, tempered with, I hope, an open-minded criticality of those aspects that are unacceptable, as the noble Baroness, Lady Gould, scarcely needed to point out. Human rights are the most obvious, because the West and this country particularly espouse and value them. I do not defend Iran's record on human rights—I spoke recently to Amnesty and have done so over the years. Its view on Iran is that human rights are generally improving, but in the past year or so it has gone backwards—not to the position that it was once in, as was characterised during the early revolutionary days, but backwards none the less. I should put in context the fact that there are fewer executions in Iran in a year than there are in the United States. We should think about that.
	Some noble Lords have said that there is no democracy in Iran, including the noble Lord, Lord Waddington. That is simply not true. While democracy in Iran is not perfect by our standards, it is more effective than in any surrounding country—countries that are often supported without equivocation by the United States. Iran has elections; we heard about the boycott—well, fewer electors boycotted the recent Iranian elections than boycotted our recent general election. Of course there is gerrymandering of the lists and there is no defence for that; but pretending that Iran is not on the road to the democracy that we would all wish it to have is idle and misleading.
	I should remind those who want to bring back the PMOI, give it support and let it loose that it was harboured, supported and sustained by Saddam Hussein—scarcely the most benign of patrons. The idea that we could do that and encourage regime change in a way that will really bring about that for which we devoutly hope—a fully democratic Iran in which human rights are fully respected—is pie in the sky and a dangerous illusion.
	I also wish to comment on what my noble friend Lady Williams said about the Iran-Iraq war. You cannot come near an understanding of the chemistry of Iran today unless you appreciate how it feels and felt about that war. It was as recently as 16 to 18 years ago that we in the West—we, too, supplied arms to Saddam—supported that ghastly man in his land grab against Iran. Try to put the boot on the other foot. What if Iran had supported a country that had tried to take, say, part of our territorial rights a mere 18 years ago and, as my noble friend Lady Williams said, we had lost a million people, killed or seriously wounded? It is not good enough to pretend that we now have the moral authority to tell the Iranians what to do and how to run their country.
	In my remaining minute, I would like to look forward, because the noble Lord, Lord Hannay, was spot on. First, I praise Jack Straw. His performance as Foreign Secretary has been impeccable. He has tried his level best to support progressive forces within Iran and is still doing so—as are the EU3. I would powerfully resist any attempt at military intervention or sanctions. We are a long way from sanctions, because the moment that we impose them is the moment that we drive Iran ever more into the solidarity that it possesses as greatly as any nation on earth. It is a proud country and you will bring all their forces together if you do that. The Americans have had sanctions for 25 years and much good it has done the Iranian progressives. The "axis of evil" speech by President Bush threw power away from the progressives and made President Khatami's attempts at rapprochement with the West nugatory.
	Nuclear demilitarisation of the Middle East is essential if we are to stop Iran trying, as it may be, to obtain nuclear arms. We can do that only in the context of the absolute guarantee of the territorial integrity of Israel. That will mean America, us and the EU giving Israel that assurance so that it can abandon its nuclear weaponry. With that there would be a prospect of getting Iran to do the right thing in nuclear terms. I also commend the notion of a UN-ensured supply of enriched uranium so that Iran can be assured of obtaining that commodity, which is essential for its peaceful nuclear generation programme.

Lord Archer of Sandwell: My Lords, I too congratulate the noble Lord, Lord Hurd, both on securing this timely debate and on his thoughtful introduction. I hope that the noble Lord, Lord Phillips, will forgive me if on this occasion I resist the temptation to embark on a bilateral debate with him. If our contributions appear to be gabbled and somewhat breathless, it reflects the economical ration of time that has been permitted. I am not complaining. Your Lordships' House can boast a ready supply of experience and expertise—everything except time.
	It is unnecessary to argue for the proposition that the Iranian Government are seeking to procure materials and equipment for the manufacture of nuclear weapons. Of course the purpose is not to provide civil nuclear energy; it is to terrorise, if not to attack, other sovereign states. The president has proudly announced his aspiration that Israel should be "wiped off the map". This is not the occasion to discuss the future of the Nuclear Non-Proliferation Treaty, although it is a pleasure, as it is so often, to agree with everything said by the noble Baroness, Lady Williams, on that subject. It is true that that regime would be seriously threatened, particularly by neighbouring states, if Iran could acquire nuclear weapons without attracting the manifest disapproval of the international community.
	However, there is a more serious aspect to the situation. A nuclear weapon in the hands of the present Iranian Government cannot be equated simply with horizontal proliferation among normal states. That Government are totally indifferent to human life and have sponsored a network of terrorism both inside and outside the borders of Iraq. I shall not repeat what was said so eloquently by my noble friend Lady Gould of Potternewton and the noble Lord, Lord Waddington, but Iran's human rights record is so appalling that it has attracted condemnation by United Nations human rights bodies on 54 occasions, without any response or improvement.
	It is not easy to show a respect we do not feel. There is no future in appeasement. Negotiations with a regime which has repeatedly broken its undertakings before the delegates have returned home are pointless. Sanctions would be a matter for the Security Council, under chapter 7 of the charter, but we all know the difficulties of imposing sanctions of a non-military character. The council's reaction to a proposal for military intervention is not always swift and sure. I doubt that we would wish to see it embark on that light-heartedly. Action unauthorised by the charter would deal a destructive blow to the international rule of law, for which the world would pay a heavy penalty. I agree with those noble Lords who have made that point.
	There are no simple solutions, but the most promising resolution of the dilemma, and the most painless one for the people of Iran, lies with the people of Iran themselves. There can be little doubt that the silent majority want change. We have heard from my noble friend Lord Temple-Morris and the right reverend Prelate the Bishop of Rochester on that. I say the silent majority; of course, it is not always silent. The Iranian Government admit that in 2004 there were 1,300 demonstrations about the economic and cultural restraints now imposed on the people of Iran. That was in spite of police brutality and repressive sentences.
	This is an unstable regime in all three senses of that word. The people of Iran are looking for a leadership they can respect. I think that is available. It was the National Council of Resistance that in 1991 revealed the nuclear programme, and in 2002 disclosed the site in Natanz. The NCRI has long spearheaded the resistance to the network of international terrorism. Not all resistance comes from outside Iran. There are very courageous advocates within its borders.
	It is tragic that in 1991 the United Kingdom government included in the schedule of terrorist organisations one of the organisations forming the NCRI, the PMOI. It was foremost in condemning the terrorism, yet its members were labelled terrorists. That decision and the procedure by which it was reached have been the subject of concern from jurists and legislators across the world. Some of us gave voice to our disquiet in a debate in your Lordships' House on 27 March 2001. That is history; I do not propose to repeat today what many of your Lordships have said, time and again, over the years. Since the decision to include the PMOI in the schedule was first made, much has changed. It was never suggested—as the former Home Secretary, my right honourable friend Jack Straw, made clear—that there was any question of a threat to the United Kingdom. The PMOI has never been violent outside the borders of Iran. It is true that some members of the PMOI have conducted violent operations within Iran. I do not condone that, but they were carefully targeted against individuals who were practising torture. There was no question of anyone else being in danger.
	In June 2001 the organisation renounced all violence and I understand that that was made known to the United Kingdom Government. It has adhered to that self-imposed prohibition. The present situation has been investigated and considered by many responsible jurists and politicians. In November, 500 jurists from 15 European countries gave opinions that the PMOI did not belong on that list. The noble and learned Lord, Lord Slynn, has considered the questions and reached a similar conclusion. Time is against me, but I should say that he asked me to tell the House that he regrets being absent from this debate, where he would have spoken for himself, but he had an unavoidable commitment elsewhere. If the NCRI were permitted to conduct its business without the shackles imposed by that label, and with a message that its revulsion against the regime is shared by every decent country in Europe, I believe that the solution to our dilemma could be found within Iran, from the Iranian people.

Lord Taverne: My Lords, the noble Lord, Lord Hurd, was very gloomy in introducing this debate; if anything, I take an even gloomier view. There is a certain amount of wishful thinking about Iran, particularly manifested—with great respect to him—by my noble friend Lord Phillips of Sudbury. First, there is the view that Iran is some kind of democracy. I certainly do not take at face value the Iranian regime's claim of a 60 per cent vote in the last election; the first figure was very much lower. What sort of democratic regime is it in which the candidates for the presidency, according to the specific provisions of electoral law, have to show that in heart and in practice they are loyal to the supreme leader? Who decides whether they are loyal to the supreme leader but the supreme leader himself? Then they are further vetted by the Revolutionary Guard. It is a very strange kind of democracy.
	Unfortunately, that was true of Khatami, before Ahmadinejad, who was not quite the noble figure and democrat that many people in the West portrayed. Too many hopes were built on him. Ahmadinejad, the present president, has brought out the regime in its true colours. Certainly it was supporting the insurgency in Iraq a long time before he came to power. There is a feeling that it may have Sharia law, but so does Saudi Arabia and we can deal with it; it is not an unreasonable regime. Since the revolution, real power has been in the hands of a small group of people who are theocratic, fundamentalist and wish to export their revolution elsewhere. It is not like Saudi Arabia, which is a conservative kingdom and does not seem to have any ambitions to export its influence. This is, unfortunately, not the case with the regime in Iran. As a state, it is the principal champion of Islamic extremism in the world.
	I do not believe that Iran will be diverted from its nuclear ambitions. We may well be to blame for these conditions and ambitions—I agree with my noble friend Lady Williams on this—and of course we should take all the reasonable steps advocated by the noble Lord, Lord Hannay. But it is clear, certainly since 2003 at least, that it intends to acquire nuclear weapons. I do not think it is going to be diverted if we are as nice to it as we can possibly be. I cannot see—and this is why I am so gloomy—any prospect of success.
	What happens if Iran is not diverted from its nuclear ambitions? Are we really expecting Israel to stand by and do nothing? I agree that military action or an invasion by the West would have the most appalling consequences. Leaving aside the fact that Saudi Arabia will certainly wish to acquire nuclear weapons, is Israel just going to stand by? I do not see this. If it needed United States assistance in its efforts—and the United States will certainly be blamed—I do not think the United States would refuse to help, if it felt Israel reasonably believed its future to be threatened.
	It seems to me that the only hope is a change of regime internally. It may or may not be likely. There have been unexpected changes of regime elsewhere, including Georgia, where a popular revolution replaced a dictatorial regime; Serbia; the Ukraine; and recently there was a manifestation of an unexpected popular uprising in Lebanon. What seems incredible in these circumstances is that we should then ban and proscribe the opposition to this regime, which it regards with most apprehension, as is the case. That opposition may not be the answer—I agree with my noble friend Lady Williams—but I just do not know. It may be no more reliable than Chalabi. I doubt that, but we certainly did not proscribe Chalabi and the Iraqi exiles. That would have been madness. The proscription was the result of a rather sordid deal done by the Foreign Secretary as a quid pro quo for the Iranians saying that they would be reasonable in the negotiations on nuclear power. That, of course, was a delusion, as has since been shown to be the case.
	So what are the grounds for proscribing the opposition? I hope that the Minister will answer that—the noble Lord, Lord Waddington, made a very powerful speech on that subject. The Minister must deal with those questions. What about the view expressed by the noble and learned Lord, Lord Slynn, who has been absolutely clear that there is no justification for the proscription of the PMOI? I hope that the Minister will answer that. It was a ridiculous stance taken by the Foreign Secretary, and the British Government should lead the way on de-proscription.

Lord Thomas of Swynnerton: My Lords, in this interesting debate, an important contribution was made by the right reverend Prelate the Bishop of Rochester, who pointed out that not only does Iran have an ancient civilisation but it has one that has influenced our own civilisation. It is perfectly true that, in speaking of Iran, we are talking about a country with a very ancient history. It is not a state patched up in the aftermath of the First World War by Sir Percy Cox and other civil servants; it is a state that has had for many centuries some degree of political life—sometimes better, sometimes worse—in the territory which it now occupies. That is probably why most of us who are not experts on Iran are interested.
	I support the position of the noble Lord, Lord Hurd, who, in an eloquent speech, argued for pressure of different sorts on Iran, and I recognise the subtlety of the subsequent approach by the noble Lord, Lord Temple-Morris, in discussing different types of pressure. However, in putting forward our view that Iran should not be allowed to develop a nuclear weapons programme, we might be more persuasive and effective if we coupled that approach with some recognition that we—Britain, as one of the eight nuclear possessor states—have an obligation to try to do something about nuclear disarmament in the long run. That point was touched upon briefly by the noble Baroness, Lady Williams, with whose speech I was in general agreement, although I much disliked her contemptuous use of the word "feudal" as though it were a synonym for evil. So far as I can see, life in Iran today is a good deal worse than it was under the feudal system—in this country at least.
	It is important to stress that. After all, as a nuclear possessor state surely we have a duty to make some plan for the long-term future. All of us who know anything of human history know that, if these weapons exist, in the long run they are bound to be used. Whatever views we may have about deterrence, in the long run they are bound to be used with catastrophic consequences.
	It is fair to recall that in the sometimes regretted days of the Cold War, the United States and the Soviet Union and their allies made token concessions to the idea that in the long run there would be general disarmament—not unilateral but general disarmament. The fact that that matter has rather dropped off the international agenda since 1990 is something that we should regret.
	We should perhaps ask the Foreign Office, through the Minister, to look again at some of those old ideas about nuclear disarmament in the long run, which we have discussed extensively in the past. It may seem a long way from Iran but it is worth recalling that, if the most ambitious disarmament plan of the era of the Cold War—the Baruch plan of 1946—had been accepted by the Soviet Union, it would have made it impossible to develop nuclear material and have nuclear development other than through an international agency.
	It is particularly satisfactory that Germany should be playing such an important part in the negotiations with Iran over the nuclear issue because Germany certainly could, technically speaking, produce nuclear weapons but, for all sorts of reasons, has not been able to do so and, indeed, has not chosen to do so. Other states, such as Canada and Australia and others in Europe, set a very fine example to the rest of the world.
	The policy urged by the noble Lord, Lord Hurd, and others could, I submit, surely be assisted in being put across if we were all conscious of our obligations to try to do something in the long run to remove the nuclear threat. I will no doubt be dismissed as a dreamer in putting forward this position but in fact I believe that I am a realist.

Lord Clarke of Hampstead: My Lords, I, too, thank the noble Lord, Lord Hurd, for securing this timely and most important debate. I declare an interest in that I have been an active supporter of the National Council of Resistance of Iran for almost 20 years.
	For many years, I have heard apologists for the mullahs advocating continued dialogue with the wicked regime in Iran. I have said on a number of occasions that it was of course necessary to attempt to reach an accommodation on the nuclear programme—the nuclear programme exposed by the National Council of Resistance, as referred to by the noble Lord, Lord Waddington. More recently, the National Council of Resistance has exposed and pinpointed the secret underground nuclear tunnels in at least 14 sites near Tehran, Esfahan and Qom. It is reported that these underground sites are used, in particular, for hiding research centres, workshops, nuclear equipment and nuclear and missile command and control centres. The building work on those sites commenced as early as 1989. It is now time to stop the talking and face the reality. The reality is that those in power in Iran were simply playing for time while they continued with their nuclear development programme. In my view, the time was passed some while ago.
	Voices in many parts of the world have been raised in an attempt to point out the folly of attempted appeasement of a vicious and evil regime—a government with a record of human rights abuses that are well documented in a number of reports to the United Nations. I am sure that Members of this House will have learnt from the state-run media in Iran that at least seven people were hanged and 11 sentenced to death in the first two weeks of this year. I say to those who try to draw a parallel between the summary execution of innocent people in Iran and the judicial system in America that there is no parallel at all. The 16 year-old girl who was hanged from a lamppost for arguing with a judge did not have the right to appeal. She did not have an army of lawyers to look after her—she was simply taken out and hanged—and a boy of 14 was beaten to death for eating during Ramadan. Comparisons with America's judicial system are odious and unnecessary and wrong in this debate. The reports of the recent hangings and executions are not my words. They are from the mullahs' own approved media outlets—Javan and the state-run new agency Irna. The executions included public hangings.

Lord Phillips of Sudbury: My Lords, I acknowledge that this is a timed debate, but as the noble Lord addressed his last remarks to me, I should make it clear that I did not make a comparison between the judicial systems of the two countries—although Iran has a judicial system. I was referring to the outcome of the judicial system, and my facts were correct.

Lord Clarke of Hampstead: My Lords, I am not a lawyer like the noble Lord, Lord Phillips. I can speak only as I hear. If I got the wrong impression, I apologise unreservedly, but the House will know what I was trying to say. They are not my words but come from the agency that is supported by the regime. Tragically there are hundreds of examples of the state-run media proclaiming what the Government have done. My noble friend Lady Gould graphically described some of them today.
	There are evil people who perpetrate torture, executions, denial of human rights, the export of terrorism—those are not my words, but the words of the Prime Minister. Tony Blair has told the world that Iran exports terrorism and finances terrorist groups. They are the hallmarks of a regime that wants a nuclear arsenal, but for what purpose we should ask. Is it to defend Iran, or to put into practice the destruction of Israel as Mahmoud Ahmadinejad has stated he wants to do? We have to decide what the real reason is.
	To their credit, the British Government, together with other European nations, have tried to maintain constructive dialogue with these dreadful people who think little of killing innocent children, and to address the persecution of those who seek to expose the reality of life in Iran. The need for encouraging the opposition that exists in Iran now is so evident. Those who say that only the Iranian people can bring about change in Iran are right. The only effective voice for change is the National Council of Resistance of Iran. If the opposition in Iran is denied the right to criticise or speak out, it is our duty to assist those who seek real democracy in Iran—not the sham elections that brought Mahmoud Ahmadinejad to power.
	Here in our safe democracy we should look at what happened before the most recent elections. Out of more than 1,000 potential candidates only eight were approved by the Guardian Council, which is the mullahs' watchdog. That is why our Government should now do the honourable thing and remove the label of terrorism from the PMOI. To his credit, our Foreign Secretary has now confessed that more than four years ago when he was Home Secretary he conceded the ban to the Iranian Foreign Minister. On Wednesday of last week, he admitted in an interview on Radio 4 that the Iranian Government demanded it—and he conceded to impose the ban.
	I remember the occasion well because I went to speak to Mr Straw in his office at the time, when he was Home Secretary. I reminded him of when we were at the Labour Party conference, which I had the privilege of chairing. I looked up at the gallery and said, "We have our friends from the People's Mojahedin of Iran with us". Everybody, including the people on the platform, welcomed them to our conference. I reminded Mr Straw of our time in opposition when we had good relations with the National Council of Resistance. To this day I cannot understand why a nation such as ours could give such comfort to brutal bullies. There is now sufficient evidence to confirm that the PMOI has renounced violence. I welcome the decision to report Iran to the United Nations Security Council.
	Finally, I urge those who think my views are strident to read the Commons Hansard report of last Wednesday. An excellent speech was made by Mr David Gauke, the Member for South West Hertfordshire. His analysis and balanced contribution to the debate on Iran's nuclear programme is well worth reading. Our Government should do everything they can to help the people of Iran to throw off the yoke of tyranny.

Lord Russell-Johnston: My Lords, like many others, I thank the noble Lord, Lord Hurd, for enabling the debate to take place. It is particularly timely because of the nuclear threat. He dealt with it sombrely as has been said, but directly and clearly, and I do not think that I can add much to his remarks.
	The noble Lord, Lord Hannay, said that we should realise how Iranians see us, given the interference for which we have been responsible. I do not dissent from that, but it is a profound mistake to regard the government in Iran as truly representative of Iranian opinion. We are dealing with a country where those espousing a fundamentalist form of Islam, which rejects all the tenets of liberal democracy, are in repressive control. The noble Baroness, Lady Gould, described the consequences for human rights, especially women's rights. I do not need to repeat them, but a short paragraph from this month's Foreign Affairs sums up the position very well, and shows that there has been no new development. It states:
	"In the aftermath of the 1979 revolution, Iran's new government quickly suspended the country's progressive family law, disallowed female judges, and strongly enforced the wearing of the hijab. Within a few months, sharia rulings lowered the marriage age to nine"—
	I repeat, nine—
	"permitted polygamy, gave fathers the right to decide who their daughters could marry, permitted unilateral divorce for men but not women, and gave fathers sole custody of children in the case of divorce"—
	a splendid judicial base on which to build a country.
	The noble Lord, Lord Temple-Morris, has far more experience of these questions, but I do not see how we can have an effective dialogue with such a regime. All we can do is support those Iranians—perhaps the majority of its youthful population—who want an open and fair society.
	As was said by the previous speaker, this task has been undertaken by the National Council of Resistance of Iran, which is a broad coalition, and which is publicly clearly committed to a democratic Iran with full religious freedom on a secular basis and human rights. I have witnessed the huge support for it among Iranians living in Europe, having taken part in rallies in Paris, where there were about 40,000 people and in Brussels where there were about 35,000. It was not reported by the BBC Farsi Service, which has been accused by the council of considerable bias. It is not a question of bias of the BBC in toto because there are no complaints about the Arabic Service or the World Service—only the Farsi Service.
	The noble Lord, Lord Hurd, suggested that Iranians outside the country had only limited influence. With great respect, I query that. Mrs Rajavi is well regarded by many in Iran who admire her courage, tenacity and objectives. Her broadcasts have had great impact within the country. There was a moment when I thought that perhaps the Foreign Office would follow this route. I remind noble Lords of the moment when the late Robin Cook spoke of his wish for an ethical foreign policy. The mandarins in the Foreign Office quickly disposed of that idea, but it remains in the minds of many. The latest Foreign Secretary, Jack Straw, admitted on the BBC last week that he agreed to have the PMOI proscribed as a terrorist organisation following a conversation with the Foreign Minister of Iran. That says it all. It is widely believed that that policy was part of the failed European Union attempt to persuade the theocratic regime to abandon its nuclear policy.
	On Tuesday morning—the day before yesterday—I was in Luxembourg at the European Court of Justice when the case against the definition of the PMOI as terrorists was brought. The noble Lord, Lord Waddington, has set this out clearly, so I need not repeat what he said, except to say that I agree with him. It was made clear at the hearing that it happened because of British pressure. Britain was directly represented. There was a European Council advocate and there was a lady advocate representing the United Kingdom. She suggested that other member states agreed with Britain but refused to specify which they were, although she said that if she had been asked before, she would have been willing to give that information. We found that rather incredible. She stated that there were regular reviews of this question. When did the last review take place? When is the next review due? Lastly, she produced no justification for the classification of the PMOI; presumably it goes back to when it was acting as insurgents against the regime. It was undoubtedly engaged in hostilities at that time.
	The Government should change their position. I know how difficult it is for any government to admit that they have been wrong. I understand the wish to get the regime to abandon its nuclear aims. Now, however, the Government must admit that the policy has been wrong and that the right thing to do is clearly to support the Iranians who want democracy.

Lord Mitchell: My Lords, I, too, thank the noble Lord, Lord Hurd of Westwell. This debate is both timely and vital.
	The Minister will be delighted to know that my speech will be brief. Four simple questions need to be asked about President Mahmoud Ahmadinejad. On two occasions, he has stated that Iran will wipe Israel off the face of the Earth. For the first time, one member of the United Nations is advocating the total annihilation of another member. Is this political posturing, or does he mean it? He has said that Iran is developing nuclear technology because Iranians need the capability to produce nuclear power, but Iran is a country swimming in oil. Why would it be making tremendous sacrifices to develop a technology that it could not conceivably need for 50 years? He absolutely denies that his country has any intention of developing nuclear weapons. But who believes him? Again, is this political posturing or does he mean it?
	It has been reported that, having made a speech in which he denied that the Holocaust ever happened, President Ahmadinejad's government is this very week sponsoring a competition for the best cartoons depicting the Holocaust, in response to the sad Danish cartoon situation. Again, is this political posturing or does he mean what he says?
	Finally, President Ahmadinejad says that he wants to promote a world Caliphate to be run by Iran. I ask again, is this political posturing or does he mean it?
	I do not believe such statements are posturing. I believe them to be true. If they are true, we certainly have a very serious problem on our hands. The noble Lord, Lord Hurd of Westwell, makes a plea for patience, but time is running out. Some of those close to the matter believe that Iran will have its own nuclear bomb within the next 12 months. It is also developing ballistic capability. It is reported that Iran has tested rockets with a range of 1,500 km. Put bomb and rocket together, and political posturing no longer looks like rhetoric.
	Let us look at the targets in Iran's sights. Coalition troops—British, American, Australian and others—are located just across the borders of neighbouring Afghanistan and Iraq. Saudi Arabia and the Gulf States are all within easy target. Finally, there is Israel—a country with no borders with Iran; indeed, a country separated from Iran by two intermediate countries.
	If President Ahmadinejad means what he says, then he needs to be resolutely deterred from any mischief making. We need firm and sensitive diplomacy, but we also need to send him a very clear message that if Iran attacks any country the consequences for him and for his country will be severe and appropriate.

Lord Dykes: My Lords, we are grateful to the noble Lord, Lord Hurd of Westwell, both for the initiative in choosing this subject and for his wise words—the words of a sadly all-too gloomy, "head-shaking about the sins of the world" kind of former Foreign Secretary. One can understand why. Many of his points were extremely important and significant, and have been repeated on a number of occasions by other speakers in this debate.
	I share the view of the noble Lord, Lord Hurd of Westwell, about the disturbing lack of UK press news on the subject. The same thing applies to the whole of the Middle East, and what is happening in Israel and Palestine. There is little detailed news in the British press. I know that it is expensive to have foreign correspondents in these hugely extended areas but, because Iraq is so dangerous, there is a concentration there. They stay in the green zone, and we get very little news from them. I am glad, as the noble Lord said, that the US is co-operating with the EU3. I will return to that in a moment.
	We also thank the noble Lord, Lord Temple-Morris, for his wise words and his knowledge and experience of that country. Although he is a gentleman in every sense of the word—if I may embarrass him by saying so—he sounded suitably fierce about the present regime in Iran and what should be done about it. I am grateful to my noble friend on the Front Bench, Lord Chidgey, for his wise words, as well as my noble friend Baroness Williams of Crosby. I only wish time would allow me to mention others.
	We ask the Minister to give us some answers to the points that have been raised. However, that is easier to ask than to deliver—not because the Minister is not capable of doing so, but because nothing is more complicated and dispiriting than this looming crisis with Iran. For once, the West, as represented by the EU3 in this context, can be thanked for some exceedingly patient diplomacy. We can also thank the IAEA for having been so patient. Back in November 2003 the chairman was already giving solemn warnings about what Iran was doing in flouting its obligations under the non-proliferation treaty.
	As a good European—I hope—I assert that it is not Europe's fault that no progress has so far been made. Indeed, the reverse is the case; it looks like a dispiriting failure. Europe—the EU3 and the whole of the Union—needs to be heavily engaged. In that context, we on these Benches fully support the Government and wish them well in dealing with these complex matters. All the options are fraught with difficulties. On the future nature of the Iranian governmental system, its so-called democratic structures are sometimes more robust than we imagine, mostly in demonstrations against the regime, when harsh measures are taken.
	However, people note what is going on, even with the limited news. We see the oppressive straitjacket of the mullahs' regime alongside the mad ranting of President Ahmadinejad. Whether he means what he says is an interesting point, but the international community has a duty to ensure that what he has recently said, about Israel and so on, is never realised.
	The Iranian diaspora is enormous and complex. Recently, even Reza Pahlavi—the son of the former Shah of Iran—has been making suggestions about democracy, despite the rather obnoxious features of his father's regime. We can perhaps take some of his suggestions with a pinch of salt; I hope I am not being unfair to the children of the former Shah.
	Americans and others are rash to seek to intervene in such dangerous territory and tell them what to do. The future of Iran belongs to the Iranian people and their decisions will count. That should be the international norm, except if they need assistance from outside of a peaceful kind in which case we should ensure that they have it.
	No one can just allow Iran's international defiance of reasonable requests to go on without the international community responding to the latent danger. Israel is understandably deeply alarmed at the potential nuclear threat if Iran goes ahead with the uranium enrichment in total defiance of the international proscription against it under the NPT. Equally, however, Israel would gain more worldwide respect—and in Arabia and Iran—if it, too, said that it was now going to adhere to the NPT and accept all the treaty obligations and duties arising from it. Why should Israel be the exception that causes a certain amount of anger and resentment in Arabia, Iran and elsewhere? Sensible Israelis know that and are well aware of it. Israel has understandably been made, by the United States, the unbeatable military power; to protect and defend itself, to ensure that it is not attacked, ruined or invaded. Nor is there any sign of anyone being able to do that. The quid pro quo is that Israel fully joins the international community and the UN Security Council in making general, collective rules of action and behaviour and suggestions for the peace of the whole area, including the development of the nuclear-free zone, as my noble friend Lady Williams said. That must be one of the priorities for the international community and the United Nations.
	President Ahmadinejad, with his extraordinary outbursts—I suppose they are populist, rallying outbursts and therefore intended for national, internal consumption, but I presume that we all notice what he says—has done a real disservice to his people by hardening opinion against his country abroad in general. It makes it much harder for sensible Ministers—there must be some; I presume that one or two moderate mullahs are around as well—to prevail in that kind of climate. Gradually, the secular population will be forced against its will to support this eccentric president.
	Now that Russia and China have joined fully in the criticism, and all five of the veto-bearing members of the United Nations Security Council are standing by for a possible resolution, which could include the imposition of sanctions, this is the critical moment. We therefore require guidance from the Minister about what the Government think can now happen. Will EU3 continue to operate just as a trio within the wider European Union in reporting to and liaising with the Security Council? Will the United States, which has been co-operating hitherto, continue to do that too and to reassure outside opinion that it will support what the whole of the United Nations Security Council decides, and not interfere in the wrong sense as it has in other countries? One is always worried about tendencies even in the Mark II Bush presidency. Some people would not readily agree that it is significantly different from Mark I, but we can leave that matter open.
	I remember being in Baghdad in 1988, when it was full of American and British businessmen, politicians and officials who were saying that Saddam Hussein's government were the most wonderful government in the whole of Arabia. It was an efficient regime which bought a lot of our military equipment. They were very opposed to Iran. Even when the gassing in Halabja had taken place, we all recall the Americans saying that the Iranians had done that and not Saddam Hussein.
	So our perceptions at a particular time can be misleading. We often regret them later on. Now is a time for collective wisdom in the United Nations and in the European Union's own deliberations about what to do. One welcomes also the opinion of the 10 new member states, including the two Mediterranean islands.
	No one wants to alienate the Iranian people because of what they perceive as the basic, built-in unfairness of the wider picture. That is an important issue. Other countries are allowed to pursue nuclear energy and peaceful nuclear activity. The United States is perceived by many people in Iran as often flouting international rules of behaviour and law. Israel is doing exactly what it likes without restraint in the occupied West Bank. More and more people think that is because of a secret agreement between Bush and Sharon. Arabia and the wider Muslim world remain unimpressed by the continuing double standards about which the United Nations does all too little for all sorts of different mechanistic reasons.
	However, Iran has to be realistic. Does it really need to do its own uranium enrichment? The answer is no. Why did it brush aside the Russian offer? I admit that it was probably made cynically, but it was a reasonable and genuine offer. If it wishes to resume its own peaceful activities, can those activities then be separated from the looming danger that they later turn into military activities? Those activities must be conducted under the non-proliferation treaty arrangements and full IAEA supervision. North Korea left the treaty, but Iran has so far wisely stayed in it. Surely, therefore, Iran needs the security guarantee package that has been proposed in the EU, in some quarters of the UN and elsewhere. That may be one of the main areas on which the Minister will enlighten us today. How will that package be constructed? Will he refer also to the question of possible sanctions?
	In the mean time, do not let us antagonise Iranian moderates with premature sanctions until all diplomatic avenues have been exhausted beyond all reasonable doubt. Iran has a final opportunity to step back from nationalistic recklessness and to co-operate fully with the inspectors. Far from that being a humiliation, it is just the normal behaviour of any adherent to the NPT. That would avoid the loss of patience that the United Nations as a whole will inevitably feel if no Iranian response is forthcoming. The stakes are high, but the prize would be great if this turns out well.

Lord Howell of Guildford: My Lords, I join with others in warmly thanking my noble friend Lord Hurd of Westwell for initiating the debate and for the magisterial overview with which he launched it. I thank also your Lordships for the brevity and briskness of many of the contributions. The digital clock seems to have gone a little awry, but the good old analogue clock tells us that the Minister will have ample time in which to answer all the questions.
	This is a time of great danger. I agree with noble Lords, including the noble Lord, Lord Hurd, who emphasised that point. I agree, too, with the noble Lord, Lord Temple-Morris, that Iran is bound to press ahead. Anyone who really knows anything about the mentality and attitudes in Tehran at the moment will know that that Government and those people will press ahead with nuclear development and move towards a weapons capability. They tried to do it in secrecy with the Natanz uranium enrichment plant and other developments—which were revealed and ceased to be secret—but they have pressed on. Frankly, all that stands in the way of Iran's move to possess nuclear weapons are technological and technical factors. Those might be considerable. There could be difficulties over the further development of Iran's uranium enrichment plants, and there could be some delays in the missile programme as well. Most of its missiles are in the "yet-to-fly" category. That is our only hope, but it is a slender hope on which to base our intentions and our desire to see stability in the region.
	It is a crucially dangerous time. It is so, first, for the obvious reason that if Iran develops nuclear weapons, proliferation will cascade throughout the region. Countries such as Egypt would perhaps want to be in on the act as well. That is an enormous danger, leading to even further instability and turmoil in the Middle East.
	It is a dangerous time, secondly, because the Western response is not working and is not going to work. Many noble Lords will disagree with that. Neither EU diplomacy nor American belligerence will stop the Iranians moving ahead on the path which they have taken. On the contrary, they will make things worse. Mutterings from Washington about the use of force or the latest, almost alarmingly dotty, rumour that three brigades are being put together to invade Iran by land are just what the hard-line mullahs and Mr Ahmadinejad need. He wants nothing more than the opportunity to defy the West. The more the diplomatic gentility of the EU drags on, and the more the mutterings from Washington about the use of force and bombing continue, the more delighted he becomes and the more certain it is that the programme for nuclear development will be accelerated. I am sure that that is correct.
	Will targeted smart sanctions from the United Nations help? I wish I shared the view of wise people such as the noble Lord, Lord Hannay, that this is the path that we should go along, and that pressure of a kind will have some effect on the Iranians. I wish that I could be an optimist along with them, but I am not—first, for the obvious reason that the United Nations will never agree.
	China has stated that it is against sanctions "on principle". It has said that it will never vote for sanctions. So that avenue is blocked. Secondly, we all know from bitter experience that sanctions do not work at all well and hit the poorest, however smart they are, and they usually have the effect of entrenching the incumbent government, which would make Mr Ahmadinejad's position stronger, which is just what he needs.
	Thirdly, and most importantly, although it was much neglected in your Lordships' debate, Iran's response to sanctions could be devastating. It could not only cut its own oil production—it is the second biggest oil exporter in the world and although it has promised OPEC that it will not do so, it is, in fact, perfectly ready to do so—but it could do much worse than that. It could mine the Straits of Hormuz, or sink a few vessels in them, and halt up to 18 million barrels of oil a day, which is about a quarter of the entire global consumption of oil. The outcome of that would be a massive world financial and energy crisis that would deeply hurt all countries, including our own, in ways that we have not experienced since the full-blown wars of the twentieth century. That is not appreciated when people talk about whether they would do this or that or use force against Iran. We are dealing with a desperately dangerous situation in which Iran could bring the roof down, not only on its own head, but on ours as well.
	Is there a silver lining to all this? Yes, there is. I have tried to explain it in an article in today's International Herald Tribune. I am very glad that the noble Lord, Lord Hurd, reads it.  The effect of all this could be to make the move to a low energy world—the green revolution—a lot more likely. Noble Lords will remember that last time there was an oil price explosion—also triggered, ironically, by events in Iran—it all turned to dust. Oil prices collapsed, after a lot of speeches from people, including me, that they were going to stay high, from $95 equivalent to $9 in a few months. All the investment in new oil alternatives, green energy, nuclear, compact cars—the whole lot—was shelved. Nothing happened. This time, Mr Ahmadinejad and the Iranians have injected real fear into the oil market. This fear is probably as effective, or more effective, than any amount of speeches by the American president on "addiction to oil" or talk about carbon reduction targets that we all know are not being met and will not be met. While I repeat that the dangers of the situation are great, and that, in the end, Mr Ahamdinejad will ruin Iran and impoverish its people, as some noble Lords have rightly said, in the mean time, perhaps we should say "Thank you" to him for a clear sign that oil will remain not just very expensive, but extremely unreliable and a wonderful but very dangerous commodity.
	One or two other questions have arisen in the debate. One is on the role of the exiles, about which my noble friend Lord Waddington spoke eloquently and passionately. My hesitant view is that they should be listened to, but not relied upon. I hope that the position of the People's Mojahedin Organisation of Iran will be kept under review by the Government and that they will have open minds and watch the position very carefully indeed. My noble friend Lord Waddington, the noble Lords, Lord Russell-Johnston and Lord Mitchell, the noble Baroness, Lady Gould, and other noble Lords said some very wise words. I hope that the Government are listening to what they say on what I recognise is a difficult situation on which one cannot leap to a particular position just like that.
	Finally, there are two evident longer-term possibilities in what is otherwise an extremely gloomy, dangerous situation that we have inadequate responses to deal with. They are that only the great Asian powers—China, India, and Japan—plus Russia can bring real pressure to bear on this Iranian regime with all its atrocities, evils and cruelties that we have heard described so graphically today. The Foreign Secretary should not be going to Brussels so much and thinking so much about what is said in Washington; he should be visiting—not summoning—Beijing, Delhi, Tokyo and Moscow. They are the countries with real leverage on Iran. China has a £70 billion gas contract with Iran and gets 14 per cent of its oil daily from Iran. Japan has huge investments in Iran and is in the same sort of position. Russia supplies civil nuclear assistance and air defence supplies and has major links and influence with Iran. As the noble Lord, Lord Anderson, said, Russia may be offering the possibility of a way out of the labyrinth with its uranium enrichment offer. That is the first point, which seems to me to be obvious, but understated. We in the West are not in a position to solve this problem alone: it is as much an Asian problem as a European or American one. We should recognise that. A too Western or Euro-centric approach will make things worse, not better.
	Secondly, it is clear that the non-proliferation treaty regime faces a crisis, as the noble Baroness, Lady Williams of Crosby, and the noble Lord, Lord Thomas of Swynnerton, rightly observed. It is obvious that it must be reformed to overcome its weaknesses, to embrace the new nuclear and would-be nuclear nations and to ensure that, even if they go this route, it is very transparent and collaborative and an effective pathway to the other NPT goals which people always forget about, which are sustained and organised disarmament and the development of safe, civil nuclear energy. Those are the aims and we must somehow embrace Iranian ambitions in them. These are the ways to contain a crisis—

Lord Dykes: My Lords, does the noble Lord include Israel in his suggestions?

Lord Howell of Guildford: My Lords, I accept that the position of Israel is crucial in this, as many noble Lords said. It should be fully taken into account. The new nuclear world is not the world of the existing five powers. Pakistan, Israel and India do not fit into the old treaty but have nuclear weapons, and others may, alas, be on the verge of getting them. The present treaty regime must be reformed—I will not say replaced—to cope with the facts and realities of the new situation. These are the ways to contain a crisis in the face of which—we must be honest and frank about this—current Western policy is proving entirely ineffective.

Lord Hannay of Chiswick: My Lords, I think I understood the noble Lord to say that it is the policy of Her Majesty's Opposition that the non-proliferation treaty should be revised to recognise the nuclear status of India, Pakistan, Israel and anyone else who wants to pop up and say that they have a nuclear programme. Is that correct?

Lord Howell of Guildford: No, my Lords. That is an over-simplification of a much more complicated thought, which is that at present we are dealing with an NPT regime with the five existing nuclear powers at its core. The reality is that there are more existing nuclear powers and—the noble Lord does not accept this, but I tell him that it will happen—Iran will get nuclear weapons. I ask the noble Lord whether he will hang on to the NPT in those circumstances, or recognise that we must embrace an Iran with nuclear weapons in a new collaborative, transparent regime. That is the issue that he, and high officials of state in his former department, will have to face. I urge them to face it sooner rather than later. Those are the remarks I have to offer to your Lordships in a fascinating debate.

Lord Triesman: My Lords, it is self-evident that today's debate is exceptionally timely. I, too, thank the noble Lord, Lord Hurd, not only for raising the issues but for doing so with such wisdom and generosity towards the Foreign Secretary and the Government. He will have seen frequently and at first hand the interests of this country and of our allies through the complex prism of security concerns, and that knowledge shone through. Twenty Members of the House have taken part in the debate, and I thank all 19, aside from myself.
	This is a desperately dangerous moment: the noble Lord, Lord Howell, is right about that. I shall read his article in the International Herald Tribune today, even if I say little about low energy economies in general in this response. I assure him that the Foreign Secretary all the time raises the questions that he seeks to have raised in capitals around the world.
	The right reverend Prelate the Bishop of Rochester and others have made the point that if we put the debate into context, it is a debate about a great and ancient culture that, sadly, is now somewhat isolated from international communities. The noble Lord, Lord Chidgey, reminds us of the dissonance and suspicion that it now has for some of the rest of the world. A good part of that is, as the noble Baroness, Lady Williams, said, because of the Iran-Iraq war. It is also, of course, about the West and its arming of Iraq, but it is also about Iraq itself and Iraq's intentions in those years.
	Last week, the 35 members of the International Atomic Energy Agency board met in special session to discuss Iran's challenge to the international non-proliferation system and how to respond to this challenge. On 4 February, they adopted a resolution that paves the way for the UN Security Council to discuss Iran's nuclear programme for the first time. This resolution is a clear demonstration of just how thin the patience of the international community has been worn by years of Iranian deception and delay.
	The noble Lord, Lord Taverne, helped us through the key sequence, as did the noble Lord, Lord Hurd, in his introductory speech. Two and a half years have now passed since Iran was forced to admit to the IAEA that for many years it had been busily engaged in the construction of secret installations to enrich uranium and to produce plutonium, which could be used to produce material for nuclear weapons. In that two and a half years, Iran has ignored repeated IAEA board resolutions calling on it to address international concerns and to take steps to build confidence that its nuclear programme is for exclusively peaceful purposes.
	In the past two and a half years, we have attempted with France and Germany, as the E3, to find a diplomatic solution to the issue. We have negotiated with Iran in good faith, aiming to persuade Iran to take steps to guarantee that its nuclear programme will not be used for military ends. We offer Iran the prospect not only of long-term solutions to the nuclear issue, but of a stronger relationship with Europe, and the prospect of building consistently on that relationship and co-operating on political and security issues and in economic and scientific fields. Iran, however, has rejected all constructive attempts to find a solution to this issue. That is why the IAEA board has been compelled to send Iran a strong message that the international community will no longer accept Iran's continuing failure to restore the confidence that was destroyed by 18 years of concealment and deception.
	The two and a half years invested in negotiations with Iran have not been wasted. I make that point straightforwardly to the noble Lord, Lord Russell-Johnston. In that time, Iran's nuclear programme has been slowed down and opened up to international inspections. Last week's vote demonstrated a degree of international consensus and unity of purpose that was quite inconceivable two and a half years ago; China and Russia voting in that group—inconceivable!
	The international community is now united in opposition to the prospect of a nuclear-armed Iran. The noble Lord, Lord Hannay, is absolutely right to say that the steps now taken in relation to the UN Security Council are the right ones. Our aim in involving the Security Council is to support rather than to supplant the IAEA's authority. No action will be taken at the Security Council until publication of the report to the March meeting of the board of governors on Iran's co-operation with the IAEA by the IAEA director-general, Dr El Baradei. Speculation about sanctions, as the noble Lord, Lord Hurd, said—I hope I am not trying to put words into his mouth—is premature at this stage, although of course their future use cannot be ruled out.
	My right honourable friends the Prime Minister and the Foreign Secretary have repeatedly made it clear that military action is on no one's agenda. We are committed to a diplomatic solution, and are working to see diplomacy succeed. The consequences of Iran acquiring nuclear weapons are unthinkable. Central Asia and the Middle East, two of the world's most volatile areas, would be destabilised. Other states are almost certain to seek to enhance their own capabilities, thus prompting a regional arms race. The Nuclear Non-Proliferation Treaty, the bedrock of international efforts to prevent the spread of nuclear weapons, would plainly be badly damaged, as would the goal, which we persist in achieving, of creating a WMD-free zone in the Middle East, a cause to which we are committed.
	If Iran's nuclear programme is indeed intended purely for civilian use, it has no economic or technical rationale. There is no requirement for Iran to resume activities now when it has no operating nuclear reactors, with only one under construction that has a long-term contract for fuel supply. More worryingly, Iran has had information that would help it to produce uranium hemispheres, which have no use other than in the development of nuclear weapons provided by the Khan operation.
	We know that information has been made available to the IAEA about tests related to high explosives and the design of a missile re-entry vehicle, all of which plainly have a military nuclear dimension. Combined with Iran's long history of concealment, these facts have resulted in a lack of international confidence that Iran's nuclear programme is for exclusively peaceful purposes, as demonstrated by the overwhelming support for Saturday's board resolution. May I say to noble Lords who have asked about the United States that I believe that it is wholly aligned with the process that I have described, as are many other countries such as Brazil, India, Egypt and China?
	That brings us to the questions that have been asked about Russia in this context. With our support, Russia too has sought a way forward that is not yet wholly formally formulated but that none the less is clear and proposes that, as part of the final agreement, Iran might have a financial-only stake in the enrichment joint venture in Russia. This would help to assure Iran that it could rely on a supply of fuel for its nuclear reactors without acquiring technologies that could be used to produce fissile material for a nuclear weapon.
	The Russians, too, made it clear that in order for their ideas to proceed further, Iran would need to keep suspended all its own enrichment and enrichment-related activities. We are prepared to endorse that idea but only so long as all the enrichment took place outside Iran and in Russia. The Russians have presented it in these terms. Since then, the Iranian position has been contradictory and, I believe, deliberately confusing. At the Iranians' request, European political directors agreed to meet one of Iran's negotiators, Javad Vaidi, in Brussels on Monday, 30 January, but Vaidi indicated that there was no room for flexibility.
	Iran's resumption of uranium enrichment-related activity three weeks ago was a clear rejection by Iran of both European and Russian efforts to get back into the talks. Iran's actions have shown no respect for the IAEA resolutions or for the commitments that it has made both to us and to the Russians. This cannot be portrayed as harmless research. The Iranians are developing technologies that would enable them to produce fissile material for nuclear weapons. What Iran claims is a small step is in fact a fundamental one.
	The consequences of Iran having those weapons—as I have said, the destabilisation of the region and the inauguration of an arms race—is unthinkable and cannot be accepted by any of us. That, in turn, raises the questions that the noble Lords, Lord Hannay and Lord Anderson, raised about the idea of fuel banks. There are possible attractions. A lot of work has been done over the best part of 30 years in looking at the establishment of a central internationally run depository for all enriched uranium produced in the world. This is not one of the options which the IAEA's panel of experts considers to be feasible at the moment. Apart from the implications for the IAEA of having to store and to maintain the stockpile, the stock of enriched uranium would be of little practical use. At the moment, there are too many different reactor designs, each with its own kind of fuel. Fuel would have to be fabricated to order, usually by the state supplying the reactor. Practical difficulties such as these, not to mention the responsibility for dispensing with spent fuels, have made it very difficult to find a workable solution as yet, but I do not rule out the possibility that people should carry on trying.

Lord Phillips of Sudbury: My Lords, would not that objection, however difficult, overcome the one real objection that any state in Iran's position might have: that they would be vulnerable to their relationship with the supplying state—in this case, Russia—in a way that the international arrangements would not be?

Lord Triesman: My Lords, I understand the point. I have no doubt that, if it were possible to see the technical solutions, everyone would embrace it very rapidly. We must overcome the practical difficulties expressed by the panels of experts, far more specialist than I am—and, perhaps I dare say, most Members of your Lordships' House.

Lord Hannay of Chiswick: My Lords, at no stage did the panel, Kofi Annan or I suggest that all enriched uranium in the world should be deposited with the International Atomic Energy Agency. It is suggested that there should be a system of drawing rights whereby countries that produced enriched uranium would contribute it to the potential of the IAEA and the countries that were in good standing with it should be able to withdraw it. If the noble Lord reflects for one minute, he will notice that that is exactly what the Russian scheme consists of. The Russians are offering to make fuel rods for Iranian reactors, so why is it so impossible to put that under a general international regime?

Lord Triesman: My Lords, I accept that that is precisely what the Russians are offering to do, and there may well be more general applicability in the sense of a virtual bank with a number of contributors. I just make the point that the IAEA is still expressing technical reservations about whether it can be done in reality but that does not rule out the idea in any respect.
	The noble Lord, Lord Anderson, asked how close we thought the Iranians were to constructing a nuclear weapon. I do not want to speculate too much but by the end of the decade is the best advice that we have at the moment. Much of the technical equipment from the Khan research laboratories is plainly in their hands.
	The noble Lord, Lord Blaker, asked what we regarded as the next step. I shall put it in context. We must consider the background against which the IAEA special board meeting took place last week. That was the next step to get the agreement of the members of that board and to then take the following step of making the reference to the United Nations. It is not just Iran's 18-year history of concealment and its failure to take steps to give us confidence in its nuclear intentions that have caused disquiet in the international community; as noble Lords have said, it is also its approach to the Middle East peace process and to Iraq, its attitude towards terrorism and its human rights record.
	We have all been appalled—nauseated—by President Ahmadinejad's denial of the existence of the Holocaust and calls for the destruction of Israel, which my right honourable friend the Foreign Secretary, described as,
	"sickening, horrific hostility to . . . Israel".
	The noble Lord, Lord Mitchell, put the point in terms. Recently, the president met leaders of Islamic Jihad in Damascus while its bombs were killing and injuring civilians in Israel. The noble Lord, Lord Dykes, in a careful and balanced approach, said that it was right and important to describe the harm done to the Iranian people through this kind of demagogic statement.
	We have a longstanding concern that groups seeking to undermine the Middle East peace process through violence draw support from inside Iran. We are concerned by its approach to terrorism and the nature of its relationship with Lebanese Hezbollah and Palestinian Islamic Jihad. We have repeatedly pressed Iran to renounce all support for groups using terror and violence, and to support a solution to the Palestinian question based on the principle of two states living side by side in peace and security. The EU has said that progress in its relations with Iran will depend on action by Iran to deal with those concerns, including its approach to terrorism and its attitude to the Middle East peace process.
	Iran has other responsibilities in the region. It is vital that the neighbours of Iraq and Afghanistan feel that, as things develop towards more democratic societies, they can do so also within a framework of peace and security. Iran has given many public undertakings to improve border security, fight terrorism and not to interfere in the internal affairs of Iraq and Afghanistan, and I welcome those commitments. Iran must resist the temptation to interfere in the political stability of its neighbours. We continue to investigate extremist Shia groups in Iraq and their links to Iran. The particular nature of some of the explosive devices used in Iraq against British troops lead us either to Iranian elements or to Lebanese Hezbollah.
	Against that background, as the noble Lord, Lord Hannay, said, we must respect Iran; we should all make efforts to do so. But, as I am sure everyone accepts, respect cannot cloak the sense that Iran's human rights violations cannot continue. The noble Lord, Lord Clarke, made the point with passion. I have also read Mr Gauke's speech and think that it is an extremely important contribution. Iran's human rights record is grim and deteriorating. The EU has been clear that our relations with Iran can move forward only if Iran takes action to address the EU's human rights concerns. We frequently express those concerns. We are particularly concerned about Iran's treatment of religious minorities, juvenile offenders and political activists.
	The noble Baroness, Lady Gould, and the noble Lord, Lord Russell-Johnston, made the point about violence against women. The words "violation of human rights" hardly encompass what is being done to women in those circumstances. With the greatest respect to the noble Lord, Lord Phillips, it does not help to apply the kind of relativism of talking about these things in a historical sequence. When faults appear in the penal system of the United Kingdom, we do not justify that by referring to Judge Jeffreys's judicial regime. Those are not the right comparisons; there are much more direct standards that are accepted and applied throughout the world—and so they should be.

Lord Phillips of Sudbury: My Lords, I was referring, not to Judge Jeffreys in the 17th century, but to the Shah, who preceded the revolution and was supported by us to the hilt.

Lord Triesman: My Lords, I still think that that is a rationalisation to set alongside what should be a much more fundamental judgment about proper human rights.
	We have emphasised that such human rights abuses—I could go through a long list but I will not—cannot continue. Nor can we continue to see freedom of expression come under increasing attack in Iran, where investigative journalists continue to be imprisoned and censorship of all the main media continues. We are monitoring closely Iran's response to recent strikes.
	Let me make a further point about whether Iran feels under great pressure. The noble Baroness, Lady Williams, asked whether it would feel more secure with a non-aggression pact in place. We are aware of no discussion between Iran, Iraq and Saudi Arabia, but we are involved with regional security conferences.

Lord Taverne: My Lords, the time allocated for the noble Lord's speech is running to an end. I hope that he will not ignore the point made by many speakers about the de-proscription of the PMOI.

Lord Triesman: My Lords, I have not the smallest intention of doing so. I shall turn to that point immediately.
	It is clear that there is a range of concerns, and I hope that that will not turn into uncritical enthusiasm for groups opposed to the Iranian regime, particularly those calling for the repeal of proscription currently in place. The MeK, or the PMOI, now tends to describe itself as a democratic party working for human rights, but there has been a history of involvement in terrorism. I have looked at the balance of the information available. In 2001 there were two armed attacks for which it accepted responsibility. It was accused of a further armed attack in June 2002, about which it has said nothing.
	Let me bring us right up to date. In an interview with the LA Times in February this year, Maryam Rajavi was asked whether the use of violence was a PMOI option now and answered,
	"The tactics and methods have been imposed not by us, but by the mullahs".
	Some may say that that is ambiguous rather than direct, but noble Lords have provided interesting information about the new disposition of these groups—as they have described it. I am willing to look at this group in particular. Fundamentally, of course, the whole of the question would need to be put to the review commission, although there are regular reviews. That is in the hands of the group itself. If it has things to say about a non-violent trajectory, that must be the way in which it carries it forward.

Lord Waddington: My Lords, the Minister is not quite right on that point. There could be de-proscription without an application by the party alleged to be a terrorist organisation—that is specifically provided for in the Act.

Lord Triesman: My Lords, proscription took place under my right honourable friend Jack Straw's tenancy of the Home Office and has continued under subsequent Home Office Secretaries of State. If the organisation has new evidence about having turned its back on violence, it is its obligation to place that evidence in competent hands where it can be assessed properly. That must be the right way forward.

Lord Archer of Sandwell: My Lords, is my noble friend ruling out the possibility of discussing the matter with someone else?

Lord Triesman: My Lords, I repeat that if noble Lords have new information, as they have indicated they have, I am willing to hear it and discuss it. It has been a measured debate. We face a complex dilemma. Some will ask what we are going to do, others ask for an assurance that we will not do anything. The United Kingdom's position, made plain by my right honourable friends the Prime Minister and the Foreign Secretary, is that we are trying to pursue peaceful and diplomatic means. We do not use the word "never" about other options, but speculation about sanctions or military action is, as the noble Lord, Lord Hurd, said at the beginning, unlikely to bolster the diplomatic effort. I think that that is right.
	At this time we are trying to make sure that we are obtaining the right responses. This is not a proposition that understates the importance of nuclear proliferation and its dangers or of Iranian support for terrorism. Iran should not believe that we have no appetite; that we are, as it has put it recently, fake superpowers or, as the president put it, mangy old lions. No one should believe that proceeding carefully shows a lack of resolve. It is careful resolve, which is what is required. The bottom line is straightforward. The international community cannot allow Iran to develop nuclear weapons capability. It cannot have the means to wipe another state off the map. It cannot export terrorism; it cannot defy the Security Council, which must ensure compliance with the Iranian international obligations. We try to make progress step by step and preferably with as little rhetoric as we can achieve.

Lord Hurd of Westwell: My Lords, it remains for me to thank all those who have taken part in the debate. I thank the Minister for his measured reply and my noble friend for injecting from the Front Bench some individual ideas that carried the argument a great deal further forward. I hope that the Minister will remember what I said at the beginning about keeping us plainly informed. We need a continuous flow of information of the quality that he has given us and he will forgive us if we press him quite hard from time to time on those points. I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

Child Support

Lord Hunt of Kings Heath: My Lords, with the leave of the House, I will repeat a Statement made by my right honourable friend in another place.
	"Mr Speaker, the previous Administration established the Child Support Agency because the system of collecting maintenance through the courts had lost the confidence of parents. It was the right decision. Different courts applied different criteria, resulting in widely differing settlements for families in similar situations. Too often cases took months to come to court. Enforcement was difficult and costly.
	"The Child Support Agency was designed to provide better support to children and families by making sure parental responsibilities were properly enforced. These were the right foundations upon which to build the new agency. It is why the Child Support Act 1991 enjoyed widespread support. But as we now know, over the years these good intentions have not been translated into good performance. When we came to office the agency cost more to run than it collected in maintenance and it was taking longer to process claims than the courts.
	"The 2000 Act made important changes. Maintenance calculations were simplified. For the first time, parents on benefits could keep up to £10 of the maintenance they received. Tougher enforcement measures were introduced. The performance of the agency has improved. It has nearly doubled the number of children receiving maintenance payments. Around £600 million of maintenance will be collected this year, twice the level of 1997. This improved performance is a credit to the hard work of the agency staff, who are doing a good job in very difficult circumstances. They have had to cope with a great deal of criticism—much of it unfair—and I want to place firmly on record my appreciation for their commitment and dedication.
	"However, notwithstanding the efforts of its staff, the performance of the agency remains unacceptable. It currently manages 1.5 million cases. Of the 670,000 cases assessed as having a positive maintenance liability, just over 400,000 parents with care are actually receiving any payment via the collection service, or have a maintenance direct arrangement in place. There is a backlog of over 300,000 cases. Despite having collected £4.5 billion, more than £3 billion of debt has built up. It has already cost the taxpayer well over £3 billion to administer.
	"Only 30 per cent of lone parents receive maintenance. Fewer than 15 per cent of lone parents on benefit receive any maintenance through the CSA. There is little evidence to suggest that outcomes are any better than under the courts system it replaced. That is why last April my right honourable friend, the Member for Hull West and Hessle, asked the new chief executive of the CSA to undertake a review of the agency's operations. I am publishing his recommendations today on my department's website.
	"The review recommended a restructuring of the agency's operation to increase productivity and performance. It proposed a plan that included migration and conversion, new legislative powers to write off debt and close cases, and the greater use of outsourcing to support the removal of backlogs and collect debt. The plan required an additional £300 million of new public money over the next three years, over and above the agency's £400 million a year budget.
	"However, even if the plan were fully implemented, at the end of the three-year period only half of lone parents would receive maintenance. Only one third of lone parents on benefit would be receiving any money. And while more parents would receive maintenance, around half of those assessed would be eligible to receive only £5 or less per week. In those circumstances I do not believe it would be right to commit £300 million of additional public expenditure in this way.
	"The CSA deals with many of the most difficult cases. In one in five cases the parents have never lived together. Five per cent question paternity. Half of absent parents have no contact at all with their children. Some 15 per cent have links to other cases—often more than one. Seventy per cent of new applications are on benefit and so have no choice but to use the CSA. Given this complexity, we should be suspicious of simple solutions. There are none. Walking away is not the answer. Neither is simply handing over the work of the CSA in its existing structure to another government department. Over 500,000 children are currently benefiting from maintenance payments collected through the CSA. We must ensure this continues.
	"However, it is time for fundamental change. Having had an opportunity to consider this over the past three months, I have concluded that neither the agency nor the policy is fit for purpose. Therefore, I have asked Sir David Henshaw—a distinguished public servant—to completely redesign our system of child support. The primary objective must be to ensure the welfare of children. Sir David will set out both the policy and operational structure needed to achieve this. He will need to consider how best to ensure parents meet their responsibilities to their children, while minimising the cost to the taxpayer.
	"In undertaking his task, Sir David will need to address several difficult choices and questions. What support and advice can be given to help parents reach a fair solution as to how best to support their children in the event of their relationship breaking down? Can we find a more cost-effective way of ensuring children get maintenance payments? What is the right balance between enforcing responsibilities, getting more money to children and value for the taxpayer? Should benefit claimants be forced to use the agency even if they have informal arrangements in place? Should the Government continue to chase cases where the parents have decided to get back together again and restart their relationship? In some instances, the agency is chasing cases where the end result will be recycling money in the same household, with no benefit to the child.
	"There will be an opportunity for all those in this House and beyond to make their views known to Sir David and his team. He will be seeking the widest possible involvement in his work. Just as the original proposals commanded widespread cross-party endorsement, my ambition is to make sure that this new framework enjoys a similar level of support. I have asked Sir David to deliver his findings to me before the Summer Recess and today I have placed in the Library copies of the terms of reference for his work. These have been drawn as widely as possible to allow all of the options for reform to be fully considered.
	"The Government have a clear responsibility to those already using the agency to ensure that it delivers for children and parents. Therefore I am publishing today proposals which will help to stabilise and improve the performance of the agency in the short term. The plan will make more effective use of current enforcement powers, improve the productivity and effectiveness of the new IT system and increase debt recovery.
	"I am making available up to £90 million of investment over the next three years, from the department's existing resources, to support this short-term recovery. This investment will of course be subject to review in the light of Sir David's work and achievement of agreed milestones. In addition, I am making a further £30 million available to contract out some of the agency's debt recovery. I expect this to result in a substantially increased recovery of the current debt owed to parents with care.
	"The CSA will take quicker and firmer action on those who default on payment. Supported by changes to the secondary legislation, we will increase the use and effectiveness of deduction from earning orders. The CSA will also be able to make more progress in clearing up the growing backlog of cases. And we will draw on data held by credit reference agencies to help speed up enforcement. I will consider tougher enforcement measures that require primary legislation. However, these will need to be addressed as part of the redesigned child support system.
	"The extra investment will mean that by 2008 we will improve compliance rates, ensure that 200,000 more children benefit from maintenance payments, be on track to help lift an additional 40,000 children out of poverty, and see a significant increase in the number of parents receiving child maintenance premium.
	"Given the considerable cost and risks involved, the stabilisation and improvement plan will stop short of converting all of the old scheme cases into the new scheme. I know that conversion is a matter of concern to many members of the House—rightly so. I have asked Sir David to consider this as part of the redesign of child support. We must come to a decision on the right way forward as soon as possible.
	"I believe that Members on all sides continue to support the original objectives of the Child Support Agency. The measures that I am announcing today are an important step towards improving the current arrangements and critically putting in place the foundations for a system of child support that will have a better chance of meeting those objectives. Relationships, as we all know, come to an end. Responsibilities do not. I know every Member of this House will want to make sure that this fundamental truth must underpin any new arrangements.
	"I commend this Statement to the House".
	My Lords, that concludes the Statement.

Lord Skelmersdale: My Lords, your Lordships will have noticed that I have an unfailing habit of thanking the Minister for repeating a Statement in this House. I do so again today. Often this extends to the content of the Statement itself, but I am very much afraid that now I cannot say the same. The Statement paints a gloomy picture indeed. Before I continue, however, I should like to say how sorry I am that the noble Baroness, Lady Hollis, is not in her place. I am sure that the whole House will join me in wishing her a full and speedy recovery.

Noble Lords: Hear, hear!

Lord Skelmersdale: My Lords, as the Statement acknowledges, the Child Support Agency was set up by the last Conservative government with all-party support. It remains as true today as it was in 1993 that, wherever possible, children should be supported financially by both parents and that even low-earning or benefit-recipient absent fathers—for it is usually fathers—should make a contribution to the upkeep of their children according to their means.
	Unfortunately, no one in either House of Parliament realised the scale of the problem that was to be tackled. However, by making a few quite popular changes in 1995 and 1996, the then government made it considerably more acceptable, in particular by reducing the maximum level of maintenance, which made it more affordable for absent parents. The Government inherited a system that was, I believe, beginning to work, and the noble Baroness, Lady Hollis, the then Minister for child support, was able to say in 1998 that around 80 per cent of assessments were correct to the last penny and that some 98 per cent of maintenance,
	"is passed on to the parent with care within 10 working days".
	None the less, the formula used to calculate payments was hideously complicated and slow and led to long delays in assessment. The Government therefore produced a new one which was intended to go live in late 2001. It was delayed several times due to problems caused by a new computer system, but it did go live in 2003. Now, three years later, it still is not working properly and cases resolved under the old formula have still not been entered into it. I note that the Statement says that it is quite likely they never will be.
	The problems with the computer programme were so dire that they caused the resignation of the chief executive last year. This was hardly surprising when a Select Committee of another place, in July 2004, described the CSA's £456 million IT system as,
	"defective and over spec, over budget and over due".
	The new chief executive, Stephen Geraghty, then stepped into the breach, with an initial remit to investigate what was going on in the agency and to report to Ministers with solutions, as we have heard. I emphasise this as it is quite clear that his solutions of another £300 million and hundreds of extra civil servants are unacceptable to the Government. I am glad, though, that we will be able to see exactly what he said through the departmental website. I cannot help but wonder whether he was given the wrong remit. But we shall see.
	The department has already admitted that there is a backlog of cases amounting to almost 330,000 and that more than £3 billion of debt remains uncollected. Recent figures from the CSA statistical summary of last month show that the new scheme is still not delivering. Why has only 61 per cent of maintenance due under the new scheme been paid as of December 2005, compared with 72 per cent under the old scheme? Why does the agency's enforcement unit cost £12 million a year to run but only managed to recover £8 million from absent parents last year? Why did the agency receive 63,678 complaints in 2004–05, an increase of almost 30 per cent? Is it because of the fact that, of the 67,000 cases assessed as having a positive maintenance capability, only just over 40,000 parents with care are actually receiving any money? Most importantly of all, why have the Government taken so long to get down to this fundamental review?
	Better late than never. So I welcome the decision to appoint Sir David Henshaw to conduct what I hope will be a root and branch review of a government organisation which by any account is a total shambles.
	I also believe that this new review should look at each operation of the CSA separately. Assessment, case management, collection and enforcement are all discrete functions of the agency and could ultimately be carried out by separate organisations, either within or without the public sector. I note that an immediate solution is to use an outside agency to collect such debts as have been identified. This must be right—but I hope the Minister will acknowledge that it is only a temporary solution. There are also suggestions around of attachment of earnings orders being used. I would have thought that these were long overdue.
	In essence, this is an honest and, for once, unspun Statement. At long last the Government are grasping a nettle and my party will do all in its power to contribute to the solution. Child support is one subject on which we desperately need a consensus.

Lord Oakeshott of Seagrove Bay: My Lords, I thank the Minister for repeating the Statement first delivered in another place. As I sat with the noble Lord in the Public Gallery in the Commons, I felt the Secretary of State's response to the serious concerns raised by my honourable friend David Laws fell far short of the standards of courtesy and behaviour we certainly expect in this House. Frankly, they did not measure up to the scale of the crisis at the CSA.
	Let me give noble Lords a little flavour of the Secretary of State's remarks. He accused David Laws of "dancing around" and "intellectual bankruptcy", and then said that he did not want to get party political. Lone parents deserve far better than that from the Secretary of State who is meant to be responsible for protecting them and seeing that they get the money they need to bring up their children.
	I pay tribute to my noble friend Lord Kirkwood of Kirkhope—as he then was not—for chairing the Select Committee in another place and its excellent report. I know that he does not exactly share our views on this particular matter, but I pay tribute to him.
	Why is it intellectually bankrupt to argue, as we do, that the CSA has failed, and failed again, beyond any reasonable prospect of redemption and that most, if not all of its functions should be handed over to HM Revenue and Customs? Why is that not a serious proposition to be examined sensibly and in detail rather than shrugged off with a few snide remarks?
	Independent observers with an open mind would point out that the Inland Revenue must be the government department best placed to know individuals' personal financial circumstances and to enforce collection of debts. We agree that such a transfer would not be easy, but we are not looking for an ideal solution, just a realistic way out of a very deep black hole where the Government seem unable to stop digging.
	I turn now to the review by Sir David Henshaw—sorry, it is not a review but a redesign. My dictionary says that a review is,
	"a formal assessment of something with the intention of instituting change".
	I would have hoped that that is what this redesign is meant to achieve.
	Let us look at the terms of reference. They are: how best to ensure that parents take financial responsibility for their children when they live apart; the best arrangements for delivering this outcome cost-effectively; and the options for moving to new structures and policies, recognising the need to protect the level of service offered to the current 1.5 million parents with care. Is that not simply a statement of what the CSA is meant to do? It is just another review of how it should work. This seems to me, yet again, to be putting off the evil day of decision.
	Why has Sir David Henshaw been selected? His curriculum vitae shows that his career has been entirely in the public sector. He has, for example, acted as a former adviser to the Prime Minister's Delivery Unit; he is a non-executive director of the Home Secretary's National Offender Management Board, adviser to the Cabinet Office Strategy Unit and member of the Treasury's Public Services Productivity Panel. With an organisation experiencing the degree of failure of the CSA, would it not have been better to have brought in someone who was more of a breath of fresh air and had some private sector discipline and experience?

Lord Hunt of Kings Heath: My Lords, as ever, I am grateful to the noble Lords, Lord Skelmersdale and Lord Oakeshott of Seagrove Bay, for what I am sure they meant to be constructive comments on the Statement. I also thank the noble Lord, Lord Skelmersdale, for his tribute to my noble friend Lady Hollis. We all hope that she will be back in her place as soon as possible. I pay tribute to her for her eight years' stewardship of the Child Support Agency, which at all times was pretty challenging. I very much admire the work she did. Whether I am so fortunate in inheriting her portfolio in that respect will have to be judged over the next few months.
	I agree with the noble Lord, Lord Skelmersdale, that children should be supported by both parents, even where their relationship has broken down. That must be the intent of any development and redesign of child support arrangements. It was the intent behind the new system introduced in 1993. The noble Lord referred a little to the history of child support since then. He also referred to the very complicated formula which the 2001 changes were designed to change. There have been many operational problems throughout the history of the CSA and the introduction of the 2001 changes has clearly not brought about the changes that were desired, although I think the actual assessment system has stood the test of time. Rough and ready though it might be, it has been one great asset of the changes.
	On conversion, I would not wish the noble Lord to think that I said "never". It is our view that the system as it stands is not yet ready for conversion, but we will look to Sir David to advise us more on that matter in his proposals to redesign the system.
	The noble Lord, Lord Skelmersdale, quoted a number of figures about performance between old and new systems. One has to be very wary about making direct comparisons because the circumstances of both systems were different. But I would not walk away from the proposition that the overall performance of the Child Support Agency has simply not been acceptable. The Statement is a clear acceptance of that fact.
	The review by Stephen Geraghty was very good, but we decided that the £300 million extra public expenditure was too risky and costly for us to make such a decision. That is why we have given Mr Geraghty the green light to institute a modified review which will cost £120 million altogether. That will be focused on increasing the numbers of staff and dealing with clients at the front line and retraining the excellent staff who have had an awful lot to put up with over the past 13 years. Over the next two to three years, we expect to see significant improvements. But as the Statement made clear, it is not only the operational matters about which we are concerned. Our analysis, which I believe is confirmed by the work of Mr Stephen Geraghty, is that the whole child support system is not fit for purpose. That is why we have asked Sir David to start with a blank sheet of paper and suggest a wholesale redesign of the system.
	I do not want to debate with the noble Lord, Lord Oakeshott, dictionary definitions of "redesign" and "review". Telling the House that we wish to redesign the system is an acceptance that the current system will simply not do. Therefore, we are going much further than simply having a review—we are asking Sir David to suggest to us the wholesale redesign of child support arrangements.
	Anyone reading Sir David's CV would conclude that he has many qualities. He has an outstanding career in the public sector. For those who think we should look to Australia for clues about how child support should be organised in the future, Sir David is also a former Visiting Fellow of the Royal Melbourne Institute of Technology. I believe that he is an excellent choice.
	The noble Lord, Lord Oakeshott, talked about having someone from the private sector. Although Mr Stephen Geraghty, the chief executive of the Child Support Agency, started life a very long time ago as an employee of the Inland Revenue, most of his highly successful career has been spent in the private sector. He has experience of banking and insurance, including running contact centres. Essentially, the CSA is a very large contact centre, albeit with very complicated matters to undertake. We have someone in post who understands the kind of operations that the CSA undertakes and has private sector experience.
	On whether we should go down the route suggested by the noble Lord, Lord Oakeshott, in terms of Her Majesty's Revenue and Customs, the point my right honourable friend was making in the other place, in a somewhat robust way, is that you cannot take an agency that faces many problems and troubles and simply plonk it under the auspices of another agency. Equally, we understand that the work of the CSA is very complicated. It is dealing with adults whose lives in many cases have become very disrupted, as shown by the figures that I quoted in the Statement. In half the cases that the CSA is concerned with, the non-resident parents have no contact with their children and one in five have not had a relationship together. Those are stunning figures and they show the complexity of the situation. With the greatest respect to Her Majesty's Revenue and Customs, it does not have the experience of dealing with those types of matters. Of course we will listen to and await with great interest Sir David's work. As the Statement made clear, we will invite parliamentarians to contribute to that work.

Lord Foulkes of Cumnock: My Lords, when I was an elected Member for a number of years, by far the most difficult, intractable problems that I faced from constituents were CSA problems, which grew and grew over the years. Does he recall that the courts did not deal with the cases, the CSA is having problems dealing with them and there is no guarantee that the Inland Revenue could deal with them any more successfully? Instead of beating ourselves, hard-working officials and dedicated Ministers around the head and body for not being able to deal with this problem, should we not be pointing the finger at the people who caused it—the errant fathers who are not meeting their responsibilities?
	We should remember that people are doing a really good job, as I know from the CSA staff who are working in what used to be my constituency. When Sir David Henshaw is doing his—it is not a review; what is it called?

Noble Lords: Redesign.

Lord Foulkes of Cumnock: My Lords, when he is conducting his redesign, as well as looking at the systems, could he also consider whether further legislation is necessary to give powers to make fathers meet their responsibilities?

Lord Hunt of Kings Heath: My Lords, there is much in what my noble friend has to say. I will not run away from the problems that the CSA has in its operational performance, but these issues go much wider. My noble friend is right. In terms of enforcement we have a real problem in the number of parents who seem to feel that it is acceptable not to support their children financially when their relationship breaks up—if they had a relationship in the first place. That is wholly unacceptable. Clearly, as part of Sir David's redesign, we are asking him to look at enforcement powers to see what further powers our new child support system needs.
	At the end of the day, it is not a question of the Government's or the agency's failing performance. The sole purpose of child support arrangements is to make sure that children receive sufficient financial support. My noble friend is also right to suggest that this is a problem that has bedevilled Parliament and governments for many years. The search for a way forward with as much consensus as possible is earnestly to be desired.

Lord Kirkwood of Kirkhope: My Lords, will the Minister acknowledge that the contract with the IT supplier, EDS, contained clauses that allowed the Government to claim compensation for non-functionality? Will he tell the House whether the Government have taken advantage of those clauses and how much if anything has been claimed back? Will he look very carefully at the position of the 270,000 parents with care who are currently in the old system and are on means-tested benefits who are denied the benefits of the new scheme; namely, the £10 premium? In this redesign through Sir David or howsoever, will he look at the equity that will be involved, and at those locked in the old system which is now shelved compared with those who have the advantages of the new system available to them right now?

Lord Hunt of Kings Heath: My Lords, I am grateful to the noble Lord and I want to pay tribute to his work as chair of the Select Committee and for its report, which was very informative. As for the computer system, noble Lords will know that it was not the most successful IT system ever developed in this country. Indeed, many problems were caused by its introduction. Frankly, I pay tribute to CSA staff who have had an almost impossible task at times in trying to work it. There has been a realignment of the contract with EDS. The result is that the original £456 million cost has been reduced by £65 million. In addition, we have held back a further £17 million based on performance.
	The system has many defects which are gradually being put right, which is gradually getting the system back to a stable state. I doubt that it will ever achieve what it ought to have achieved, but it is becoming more fit for purpose. Clearly, we need to be strong in terms of our relationship with EDS. Also, it is in the interests of everyone to make sure that there is co-operation in putting right the rest of the defects.
	On the child maintenance premium, I well understand the matter that the noble Lord raised, particularly in relation to parents with care who are on the old system who have not been converted to the new system. The problems are the operational feasibility and cost. I have taken advice on this matter and I understand that manual intervention is required in the vast majority of cases, which might mean looking at 300,000 cases manually in order to pick the 50,000 that are likely to be eligible. As the noble Lord will realise, the amount of work involved would be extensive. However, as part of the redesign, it is a matter that we will ask Sir David to pick up.

Lord Molyneaux of Killead: My Lords, I noticed that in the initial stages of contact between parents and the CSA, parents were given a special number to telephone for advice. They tried many times to make contact. I do not know whether the line was out of action or whether it was deliberately blocked—I am not passing judgment on that; I say that only because that is the type of trap that the new body should avoid. I have not until now heard of any parents—former constituents of mine—who have successfully made contact, anxious to help as they were. They have utterly failed to make any contact or get advice at any stage.

Lord Hunt of Kings Heath: My Lords, I am grateful to the noble Lord. The figures that I have show that the average waiting time for callers is now 13 seconds for the new system as opposed to 49 seconds for the old system, which is a big improvement over the past 12 months. Obviously, there is a way to go and part of the work that we now wish to undertake within the CSA is to improve on that. Having visited the Northern Ireland CSA, which has a close relationship with the CSA in the rest of the country, I have been impressed with the dedication of staff in the Belfast centre who, as I said earlier, do a difficult job to the best of their abilities.

Lord Lea of Crondall: My Lords, I welcome the new design but I want to ask about experience in other countries in Europe. Presumably, every country has this problem and finds the solution very difficult to reach. Will Sir David Henshaw in the time that he has been given before the summer recess be able to look at the experience in other European countries in particular?

Lord Hunt of Kings Heath: My Lords, my noble friend raises an important point. I have not had the advantage of visiting child support services in other countries as yet although no doubt the time will come. Clearly, experience in other countries shows that this is a very difficult area. There is no question that collecting child support from parents who do not want to give money to their former partners in respect of their children is a difficult issue to deal with. There clearly are examples of systems in other countries which seem to work better than those here. We should learn from them. Australia is often pointed at as the best example in the world. It is different; in Australia most people turn to the Australian Child Support Agency. It also has, because the tax system is rather different in Australia, much greater access to information.
	There are clearly lessons that we can learn there but, at the end of day—rather like the suggestion that you could simply hand CSA over to Revenue and Customs—we need to adapt any lessons from other countries to our own situation. In looking at the experience of other countries, that would be a matter for Sir David himself to decide.

Lord Maclennan of Rogart: My Lords, while recognising the reasoning for rejecting the financial costs of the Geraghty report, will the redesign proposals be limited, or required to be contained within any ceiling of expenditure?

Lord Hunt of Kings Heath: My Lords, affordability and cost-effectiveness are words that come clearly to mind in any policy that is going to be developed. I cannot say any more than that. We will have to wait and see what Sir David's redesign proposals are concerned with. We found it difficult to justify an expenditure of £300 million of additional money for a child support system which, to all intents, is widely thought to be in serious difficulty and which we believe to be not fit for purpose. It would have been risky. That is why we felt we could make some initial investment to deal with some immediate problems for more front-line staff, but on overall expenditure for the future, the first thing is to see what Sir David comes up with in terms of the redesign.

Freedom of Speech

Baroness Knight of Collingtree: rose to call attention to recent developments affecting freedom of speech; and to move for Papers.
	My Lords, since history began and all throughout time, there have been declarations about the significance of free speech as a crucial part of a free society. In the first century AD, an emperor of Rome said,
	"In a free state, there must be free speech".
	The 16th, 17th and 18th centuries voiced agreement. In 1575, an MP in Parliament said,
	"There is nothing so necessary for the preservation of the state as free speech".
	Milton followed that a century later with,
	"Give me the liberty to know, to utter and to argue freely, according to conscience, above all liberties".
	Another hundred years on, a judge in the High Court said,
	"Human laws ought not to interpose, nay cannot interpose, to prevent the communication of sentiments and opinions".
	There is no shortage of similar quotes for the last two centuries either, but I want to get on. Let us acknowledge that freedom of speech is still, as it always has been, the main concomitant of a free society, and if the former goes, then the latter will, too. I believe that the Government support this view. The noble Baroness, Lady Scotland, said in this House that we,
	"need to protect our freedom of expression and freedom of speech".—[Official Report, 24/1/06; col. 1071.]
	Indeed we do; it is vanishing before our eyes. This debate is about recognising this, and stopping it.
	The emperor, the judge, the MP and Milton must be spinning in their graves today. Simply for reading out the names of dead soldiers during a peaceful demonstration near the Cenotaph, a young woman was arrested, charged and convicted, and she now has a criminal record. That cannot be right; she was not threatening, nor inciting anyone to murder, nor had plans to be a suicide bomber. She was simply reading out a list of names. For that she is listed as a criminal, and 20 more similar cases are pending. A woman taking part in a radio programme said she thought that two men should not be allowed to adopt a young boy—others might possibly agree. She was telephoned by the police and informed that her name had been recorded on a police register for what she had said. A 74 year-old black man was surrounded by police and ordered to remove a placard which he had hung round his neck. Was it urging people to riot, to behead infidels or to attack property? Not exactly; it read, "Jesus Christ is lord" and urged repentance. I cannot see why that should be an arrestable offence, but apparently it was.
	I well remember the sandwich men, as they used to be called, wandering the London streets with similar notices in the past. There was one regular whose message read,
	"Repent, for the end of the world is nigh".
	It was not, but no one minded and no such bearers were ever stopped by police and threatened that, if they did not remove their placard, they would be arrested on a criminal charge. You were allowed to express your opinion then, and the world and his wife passed by, often with a pitying little smile at your eccentricity. All these cases I mention are recent, and all brought forth instant action by the police. No wonder there is a growing nervousness about speaking one's mind. Our laws are being interpreted differently for different religions, though I think they should be the same for everyone.
	I believe that the Government want to protect freedom of expression; unfortunately, local government too often does not. A fearsome number of local councils judge political correctness to be more important than free speech. In some cities, you are not allowed to celebrate Christmas if you call it that. The C-word must not be used in public displays or decorations. The charming custom of schools staging nativity plays with pint-sized angels, kings and shepherds, is banned. One wonders what might happen if British Christians went to live in a Muslim country. Would there be pressure there for Muhammad's name not to be mentioned? I don't think so.
	Schools have changed. Teachers and carers dare not give a small child who is crying a comforting cuddle, nor touch them at all—although often that is exactly what the little soul needs! Bang goes another freedom of expression. If a girl when under the age of consent becomes pregnant, a crime has been committed. Nothing much seems to be done to pursue that point, but the girl's teacher cannot tell the girl's parents, however loving and caring they may be, unless the child agrees. Yet in many cases, if the parents did know, they would rally round, support and help the girl, whatever she decided.
	All that has happened in the past few years. Christmas has always been named and celebrated and Christianity supported. It is after all our national, established Church, and there should be nothing wrong in supporting it. Good teachers have always provided sympathy and comfort for unhappy little children—and parents with the heavy responsibilities they bear, have the right to know of their children's problems. Freedom of speech has been sacrosanct until now.
	The noble Baroness, Lady Thatcher, commented about the Salman Rushdie case that it is,
	"an essential part of our democratic system that people who act within the law should be able to express their opinions freely".
	Exactly—within the law.
	The man who has taken up residence in Parliament Square, opposite the main gates of the House of Commons, has a perfect right to voice his opinions, whatever they may be. But what gives him the right permanently to deface one of the most prestigious pieces of public land in Britain with his filthy flags and tatty signs? That is not free speech—it is blatant vandalism. And I put the proposition that there really is a fundamental difference between allowing people to say what they think and allowing them to incite violence.
	It is offensive to Muslims that Muhammad should be portrayed with a bomb in his turban; that is perfectly understandable. It is just as offensive to Christians that Jesus Christ should be blasphemed against and ridiculed, but I have never heard of Christians taking to the streets to demand that those who have blasphemed or ridiculed should be beheaded. If they had, I should certainly condemn them. Throughout history, famous people—clerics, kings, politicians and even deities—have been ridiculed in cartoons published in Britain; but no one has suggested banning the practice or stamping on press freedom until now. That worries me.
	Theatres can and do produce plays which are grossly offensive to Christians. There may be a few protests, but nothing happens—the play goes ahead. But if they plan a show which is offensive to Muslims, they are bullied and there are riots and threats and harassment until the play is withdrawn; and it always is. Sensible Muslims—and there are plenty of them—certainly do not advocate or support special treatment for Muslims; but to many observers that seems to be happening, and that, too, is very dangerous for society. Peaceable and law-abiding indigenous members of society are arrested for reciting names, for trying to get signatures on a petition, or merely for giving their opinions or carrying a placard naming Jesus, or even being rough-handled for heckling at a political meeting. There is instant action against those people.
	But for years the police knew that one Muslim was actively inciting extreme violence, training suicide bombers, hoarding weapons and dishing out false passports. Yet they did not arrest him, because the Crown Prosecution Service, or somebody or other—there is some dispute about who exactly said it—said no. So they did not. But thank God the police finally did arrest him—and thank God he now faces a prison sentence. It is not a very long one, it is true, and he could be out in about three years; but at least he is in prison now. But when one recalls that one of his students very nearly blew up a whole planeload of people with explosions hidden in his shoe, one cannot fail to note that that very late judgment by the police actually threatened many lives.
	If that man with the explosives in his shoe had not been discovered by very vigilant security men, a whole planeload of people could have died, because of that one man who was left for so long free to do that. Whether the late decision was caused by loosely worded laws, the CPS or MI5, the police or political correctness, I do not know, and I do not think that anybody else knows. Perhaps it was a bit of all five put together; I do not know. However, I hope and trust that the Minister can assure us, first, that free speech will not be further curtailed. I should make it clear that I do not seek to attack the Government here; I do not think that they are at all in favour of what has been happening. I merely hope that when we receive the Minister's reply, we shall learn that such further curtailment will not happen.
	Secondly, can the Minister assure us that whatever laws exist in this land, they must be applied equally and fairly to everyone? The British people are slow to anger and very tolerant, but they can be pushed too far. Any further diminution in equal justice and free speech could do that. I beg to move for Papers.

Lord Dubs: My Lords, I am grateful to the noble Baroness, Lady Knight, for raising this important issue and giving us the chance to debate it. I would like to address it under two headings. First, what should be the limits of free speech, if any? Secondly, what limits are there on the protests about how others exercise their rights to free speech? Both those issues were reflected in the speech of the noble Baroness and are the subject of much newspaper speculation and discussion.
	We all know that this is a difficult issue. The recent discussion about the Danish cartoons has made us all realise that it is simply not straightforward. Meanwhile, I find the recent BNP court decision to be, at the very least, almost impossible to understand. However, free speech is not just about the right of the majority. It is an even more fundamental protection for minorities. We only have to look at other countries where there is no free speech to see how minorities are victimised and unable to exercise their right of expression. I would say to all minorities in Britain, "This important right protects you more than it does the majority in this country".
	Perhaps I should declare an interest as a former member of the Broadcasting Standards Commission, and for a time its chairman. We were, of course, not censoring television or radio; we dealt with complaints against their content if it breached the code. Some complaints were on the sort of issues raised by the noble Baroness in her speech. Post 9/11, the Broadcasting Standards Commission was asked to meet representatives of the Muslim community who were concerned about the way that their community was being portrayed on television and radio. We had two long afternoon meetings with broadcasters, regulators and those community representatives. The outcome was that we were able to assure the Muslim community that, in the main, the existing codes which determined practice by broadcasters and regulators provided it with a fair measure of protection, but that there was also the opportunity to move the codes forward—and the broadcasters agreed to do that.
	More recently, there have been many protests by Christians about "Jerry Springer—The Opera", but I can perhaps speak with rather more experience about "The Last Temptation of Christ", which provoked a similar set of complaints from Churches. I remember that we at the Broadcasting Standards Commission received petitions from Churches and protests that the film should not be shown. We had no powers over that, but in the event we did not uphold the complaints that we received. My point is that, in talking to a number of people about television programmes and the harm from television, I spoke to a young student who was a devout Christian. I said to him, "Last night, Channel 4 showed 'The Last Temptation of Christ'. Did you see it?". "Yes", he said. "Are you aware of the numerous complaints by Churches against that particular film being shown?". That devout Christian man said, in words that I shall never forget, "I have no problem with that film. Jesus can look after himself".
	Despite his comments, I am sure that some Christians have been deeply offended by some of what appears on television. Yet, as a society, we also accept that many films about which there are complaints are serious works and that we have the right to see them. I would add that people in a free society cannot be protected from feeling irritated, insulted or even offended. That is part of freedom of speech; we may all be offended by certain things and must accept that freedom of speech operates in that way. Yet, as I shall say in a minute or two, violence or threats of violence are surely much worse than being offended or irritated by what one sees or reads. Everyone who believes in free speech should also exercise that right with care, for it includes respect for others and a sense of responsibility.
	This is an appropriate moment to turn to the Danish cartoons. Yes, the papers there had the right to publish them. Were they wise to do so? I think not, and I am relieved that British newspapers had the sense not to publish them. After the initial publication of the cartoons, there was no particularly good case for republishing them time and time again. The British media made a wise judgment.
	However, the noble Baroness referred to Salman Rushdie's book. The attempt to suppress that book was a much more serious attack on free speech than the cartoons in Denmark. More recently, there was the case of the Sikh play "Beshti" in Birmingham. An angry mob stopped that play being performed and I am as dismayed by that as I am by the fact that it has been forgotten. We have not bothered about it, and yet all we need is another angry mob to stop any other play being shown. That is a disgrace, because it has imposed a constraint on authors and playwrights.
	If free speech is exercised lawfully and there are some constraints such as incitement to racial hatred and other criminal matters, the question is how we protest about how to exercise that free speech if we are not happy. It is unacceptable to threaten violence and murder because one does not like something that has been published. I welcome the fact that the great majority of moderate Muslims protested about the violence at the demonstrations last Saturday.
	We must accept that the right to protest peacefully is an important function of our society. I agree that these issues are difficult, but surely we need courage, tempered by responsibility and respect for the views of others.

Baroness Falkner of Margravine: My Lords, I, too, thank the noble Baroness, Lady Knight of Collingtree, for initiating this debate on such a current issue. The past few weeks have not been happy for secular-minded people. They have resulted in loss of life far beyond our shores and have weakened international relations between the West and the Muslim world. They have also shown that a common European foreign policy has some way to go. I, for one, regret the lack of solidarity with Denmark and Norway by the EU, when all tenets of international law were breached in the ransacking of those countries' missions in Syria and Lebanon. The EU could and should have been more vigorous in its condemnation of those acts.
	My more immediate concern is with community relations between western Muslims, in particular, our situation here in Britain, and broader questions of freedom of speech. As the only Muslim speaking in this debate, I will not dwell on theological arguments about how offensive these cartoons are. That they are, is indisputable, and we find ourselves in a situation where large numbers of our fellow citizens feel deeply offended by the publication and republication of those cartoons. Newspapers are going out of their way to republish the cartoons and that is turning legitimate debate into gratuitous offence. It does not help anything other than to provide succour to "fundamentalists" on each side. Is that the agenda of those defending free speech? I would hope not.
	Turning to "fundamentalists" on the Muslim side—namely those protesting in London last weekend—many of us can understand that those demonstrating had high feelings. What we cannot understand or condone are the implicit and explicit incitements to terrorism and murder. I, and countless others like me, have just one thing to say to them—"Not in my name". What is also troubling about recent events is the role of certain clerics who appear to have said one thing for their western audiences, and said other far more radical things to Muslim audiences. I would urge religious leaders to be moderate and consistent. Violence and loss of life are not in the interests of any group on any side.
	It is also difficult to understand how the Metropolitan Police arrived at its decision to do nothing about the offensive placards. There are also allegations by some of the protestors, repeated on BBC's "Newsnight" on Monday, that the Met had "cleared" the placards as being acceptable. If that is so, it is very grave. I appreciate that the police are independent of ministerial control, but hope that in due course the Metropolitan Police Authority will seek the truth of those allegations. I also hope that, unlike the Abu Hamza case, the police do not hold back from arresting those advocating violence in such protests. It does no community good if the police interpret the same laws differently across different communities, as the noble Baroness, Lady Knight, has detailed.
	Moving to broader questions of freedom of expression, let me say from the outset that I am clearly in the camp that seeks to uphold that right, recognising that at times offence is indeed caused and deeply felt. Does this mean that we should be more careful in the exercising that right? My answer would be "yes," but I prefer self-censorship to state censorship, hence my opposition over the past years to the many provisions restricting free speech that this Government have tried to legislate for in recent Bills. I prefer a situation where we recognise that there is a thin dividing line between free speech on the one hand and tolerance on the other. I would, therefore, urge the Government to oppose calls from the newly formed Muslim Action Committee yesterday, which seeks to outlaw the publication of cartoons in the UK by strengthening the Press Complaints Commission's code. I would say to them that the Muslim cause is well served under current legislation. Enlarging the scope of the law may well result in casting the net so wide that the very first people caught by it are Muslims themselves.
	There are also wider questions for us western Muslims. If we choose to live in the West, should we not make an attempt to understand western history and the meaning of the Enlightenment? I found the tone of the comments of the noble Baroness, Lady Knight, interesting, particularly in her portrayal of Christian tolerance and harmony. Might I go so far as to remind the noble Baroness, most respectfully, that the Enlightenment followed the Inquisition when, of course, many people were burned at the stake as heretics?
	Turning to ourselves, as Muslims, I would say that we should go beyond understanding, to empathise with the richness of western culture. While we can take just pride in our own, should we also not embrace western freedoms, such as those of dissent and protest in democracies? I would say to my co-religionists that we have some way to go in moderating our excessively emotional behaviour, and in understanding how to protest and voice dissent in a responsible manner. I do not refer only to western Muslims here, but to the loss of life across the Muslim world. Getting angry in the abstract should not lead to the violence we have witnessed recently. Islam stands above all this. We need to learn that respect for our belief cannot be forcibly extracted. By our behaviour it is earned, and by our behaviour diminishes us all. Such are the laws of unintended consequences.
	In concluding, it would be tempting to reflect on these last days and hope that it will all blow over. While I would deeply hope that that may be the case, I suspect that much bridge building needs to follow. One aspect of that bridge building is the Government's Commission on Integration, announced by the Prime Minister last August. This is needed now more than ever and I urge the Government to get it under way by setting it up and seeking support from across the political spectrum—and beyond—in that endeavour. We all need to work together to move beyond these troubled times.

The Lord Bishop of Durham: My Lords, I, too, am grateful to the noble Baroness, Lady Knight, for the opportunity to address some urgent issues. I think it would be a mistake to confine our attention today to the Danish cartoons and their aftermath, regrettable though all that is, or indeed to the recent court cases. These fall within a larger moral and social landscape. We are faced with moral climate change, which is comparable to other forms of climate change and equally dangerous.
	The 1960s swept away the old moral certainties, but getting rid of them has not made us happier or safer. Hence, the invention of new quasi-moralities out of bits and pieces of moral rhetoric; the increasingly shrill language of rights; the glorification of victimhood, which enables anyone with hurt feelings to claim high moral ground; and the invention of various "identities," which demand not only protection, but immunity from all critique. It was this messy but potent combination of neo-moralities that generated the religious hatred legislation, of which your noble Lordships, rightly in my opinion, took a dim view recently.
	It is not just the invention of new moralities that should concern us; it is the attempt to enforce them—to enforce, that is, newly invented standards that, in some cases, are the exact opposite of the old ones. How else can we explain the attempted ejection of protestors, whether from a party conference or even, yes, from Parliament Square? How else can we explain the anxiety not only of religious leaders but also of comedians when faced with the proposed religious hatred legislation? How else can we explain the police investigation of religious leaders, such as my colleague the right reverend Prelate the Bishop of Chester or the chair of the Muslim Council of Britain for making moderate and considered statements about homosexual practice? As the crimes in question have to do not with actions but with ideas and beliefs, what we are seeing is thought crime. People in my diocese have told me that they are now frightened to express their opinions down at the pub on matters of considerable public interest today for fear of being reported, investigated and perhaps even charged. I did not think that I would see such a thing in this country in my lifetime. The word for it is tyranny—sudden moral climate change enforced by thought police.
	The answer cannot be simply to repeat the old 18th century slogans of "tolerance" or "freedom of speech", as if they were straightforward concepts that would commend themselves and restore everything to sanity very easily. They are not. The Enlightenment modernism, where those concepts find their natural home, is busy crumbling under the post-modern critique. Let us not fool ourselves—that is where we are culturally. In that climate, tolerance and freedom are reduced to mere licence and then are quietly redefined so that we will not any longer tolerate dissent from the new party lines that emerge. Intolerant tolerance is one of the greatest obstacles to genuine freedom of speech.
	Whose freedom are we talking about anyway? Notoriously, the freedom of my fist ends where the freedom of your nose begins. Similarly, the freedom of my speech has always been curtailed by the freedom of your honour, as the laws of slander and libel have always recognised. Part of the problem of freedom of speech is that it is often the media that are most in favour of it, although they themselves often cheerfully censor information that cuts against editorial policy.
	Freedom of speech is useless if it is only selectively enjoyed and if it is not combined with appropriate responsibility. It needs to be set within a larger context of social and cultural wisdom. We have to find a way through the post-modern morass, not to go back to the Enlightenment modernism—we cannot do that—but in order to go out the other side into the construction of a new world of civility and mature public discourse. For that, freedom of speech has to be reciprocal. It needs the disciplines of interaction, of patient listening and attention.
	To that end, we must take the religious dimension seriously as part of the whole and not wave it away as dangerous or irrelevant, as some these days are inclined to do. The increasingly shrill attempts to banish religion from public life are, I believe, self-defeating. Rather, we in the Church are committed as a matter of urgency to working on public issues with the other great households of faith. I mention particularly the new Christian-Muslim Forum, launched just last week, to stand alongside the Council for Christians and Jews, the Three Faiths Forum and similar bodies.
	In these initiatives, tolerance is not the point. I can tolerate someone standing on the other side of the street; I do not need to engage with them. Tolerance all too easily supposes that all religions are basically the same and that they can all be discounted for purposes of public life. Thanks to the 18th century, that is what many people still believe. But tolerance is a parody of something deeper, richer and more costly for which we must work—a genuine and reciprocal freedom. It is a freedom properly contextualised within a wise responsibility. It is freedom not to be gratuitously rude or offensive—I totally agree with what the noble Baroness, Lady Falkner, said about that—especially to those who are already in danger on the margins of society, but freedom to speak the truth as we see it while simultaneously paying great attention to listening to the truth as others see and speak it and to work forwards together from there. That is so in matters of religion; it is so in matters of public policy; it is so in matters of sexual morality; and it is so in areas where all those issues and others rightly overlap and interlock. It is precisely that sort of wise, responsible freedom that is at risk if honestly held beliefs, clearly and respectfully expressed, are likely to get you into trouble with the law. We must learn fresh wisdom before the moral climate changes irreversibly and the sea rises to engulf the moral lowlands where we presently live.

Lord Giddens: My Lords, I, too, thank the noble Baroness, Lady Knight, for initiating this debate. We get only six minutes each to perform; I am not sure that I would define that as freedom of speech, but nevertheless the noble Baroness has an immaculate sense of timing.
	In the light of the massive furore in the world about the aforementioned Danish cartoons, and while accepting what the right reverend Prelate said about having to fiddle with it in a larger context, I should like to pursue the implications of that event. One of the things that this global encounter shows is the extraordinary nature of the new global age in which we live. It is driven not by the marketplace but by telecommunications. When the cartoons were re-published, there was an immediate explosion of reaction in so many different countries ranging from Pakistan, Indonesia, the Lebanon, the West Bank, Gaza, to, in a milder version, here in London.
	There is another side to it which I think is worth considering: check the Internet. We see all these dramatic and violent events, but there is unbelievable debate taking place on the Internet with an enormous diversity of positions being expressed around the world. There is a kind of electronic cosmopolitan debate under way about what seems to many in the West as a rather limited set of cartoons.
	In the wake of 9/11, a French newspaper—I think it was Le Monde—said:
	"We are all Americans now".
	That attitude did not last for too long. But a number of newspapers have subsequently published headlines saying, "We are all Danes now". A Danish newspaper stood up for freedom of speech, so we should stand up for it. I therefore ask: are we all Danes now?
	I have a couple of brief comments about freedom of speech which touch on some remarks that have already been made. Many people assert the idea of freedom of speech as though it were an absolute value, but obviously it is not an absolute value. It is an instrument to produce a more effective and liberal society, and it is always surrounded by conventions.
	The comedian Lenny Bruce said that he had to say the "F" word in public, which was well before it was ever said on television or in any other public setting. He had to say, "'F' the government". Many on the Opposition Benches may want to say, "'F' the government", but fortunately they do not say it in your Lordships' House. It is right and proper that they do not say it. There are always conventions that restrict what we say in a variety of contexts.
	We have to distinguish between freedom of speech and a free society because the two are not the same. Freedom of speech is the necessary condition for a free society, but it is by no means a sufficient condition. It has to be hedged by attention to the sensibilities of others and the damage that speech can sometimes do, and by attention to the other values that we hold. As has been mentioned, freedom of speech is always limited in law in all democratic countries in respect of libel, slander, obscenity, sex exploitation of children and many other offences. That is right and proper.
	Europe is the home of freedom of speech, but I remind noble Lords that Europe is also the home of the Holocaust. In Germany, the Netherlands and Austria, you can be imprisoned for making public remarks about the Holocaust. You can be imprisoned for Holocaust denial—someone is on the point of being imprisoned for that—and for making various kinds of anti-Semitic remarks. These, in a sense, are our sensitivities. They are a part of our sacred values in a European context.
	Are we all Danes now? I will give three answers within my six minutes. Yes, we are all Danes now if that means that we must stand up against the use of violence to stop us doing something that is part of the conditions of life in democratic society. Many people who run abortion clinics in the United States live in fear of Christian activists who have bombed such clinics and attacked and murdered people in them. Dr David Gunn was murdered outside an abortion clinic in the United States in 1993. In case noble Lords think that it cannot happen here, the Christian activist movement says that it will and that we must prepare for a war over the issue. We must stand up to the use of violence to deny free speech.
	Are we all Danes now? Yes, in the sense that we must stand up to religious fundamentalism. We must deny the right of fundamentalists to speak for the wider spectrum of religion, whether Christian or Muslim. I found it heartening, after an Islamic group had invaded a Christian quarter in the Lebanon and rampaged around, that Christians and Muslims got together and staged a joint march. That is exactly what we should do in the face of such assaults.
	Are we all Danes now? No, in the sense that the cartoons should not have been published. They were not published primarily in terms of the two principles I have just enunciated—at least, that is certainly not clear. They were published in an increasingly xenophobic society, which is increasingly hostile to some expressions of Islamic religiosity and religious culture. They were published in the knowledge that they would have dangerous consequences in Denmark, though I do not think the editor realised that it would be a global explosion. However, we must pay attention to the sensitivity of the sacred values of others. We live in an essentially secular society, but sacred values have particular purchase, which must be respected.
	In conclusion—I have got to seven minutes—there is a battle going on across the world. It is not a battle between Islam and the rest or between Islam and the West, because it is going on within the West. It is a battle between fundamentalism and cosmopolitanism, and we must ensure that the cosmopolitans win.

Lord Lucas: My Lords, I am grateful to my noble friend for giving us this opportunity. I am also grateful to the Minister, because I cannot think that it was anyone else who, having listened to all the excellent arguments in this House, persuaded the Prime Minister to miss that vote the other day. In particular, I remember the speech of the noble Lord, Lord Plant of Highfield, pointing out that there was no difference between a religion and its adherents, and that if you insult a religion you hurt its adherents. That has been perfectly demonstrated by this episode of the Danish cartoons.
	Islam has suffered no damage at all from the publication of those cartoons; the hurt in the Muslim community has been immense. That is the nature of these things, and why we are so well rid of the Bill as it was originally drafted. We must be extremely careful to guard our freedom of speech. It is a difficult thing to do. I was immensely inspired by the speech of the right reverend Prelate the Bishop of Durham. It was well thought out, and I shall read it again because I am sure that I have not absorbed all its wisdom on first hearing. I thought that its summary was that this is the perfect place to discuss free speech, because the House of Lords gets it right; the way that we conduct ourselves is the way that everyone else should. You do come to believe that after a while here, so I shall not disagree with him on that.
	It went deeper, however. Before I turn to where I agree with the right reverend Prelate, I will say that two parts of our society have come out of this latest episode extremely well. The first is the Muslim community in general. The way that it has reacted to this—responsibly, as part of our British community—has given me enormous comfort after all the difficulties and tribulations we have been through over the past few years. There will always be elements who try to disrupt things, but that is not the image which sticks in my mind.
	The British press have also come out of this episode well. As the noble Lord, Lord Giddens, said, the cartoons are tasteless and insulting. They are of no value in themselves. To reprint them would be an act of sheer gratuitous insult. In the majority community, we have to get used to accepting insult. We do not wish to curtail people's rights to publish cartoons about George Bush, the Prime Minister or whoever. When we are in that sort of position of power, these are ordinary parts of daily life, and so they should be. But we have to be conscious that when a community is in a minority and finds itself somewhat embattled, then to hurt them is to hurt them excessively. We have to be extremely careful and judge well when we take an action that might do that. The press have judged that extremely finely. I take great comfort from that because the press has been growing up during the past 20 years and it has gained enormous power. This is a sign that it is learning to use it responsibly.
	The group which has not come out well from this episode—and from many previous episodes, as noble Lords have said—is the Government. It is the Government's responsibility to set the tone for the defence of the freedom of speech. It will not be Ministers who react in each instance. It is their servants and their acolytes who will react in the way they perceive their masters as wishing them to act. The tone that this Government have set over the years has been one of denial of freedom of speech.
	The police's reaction to the demonstration outside the Danish embassy and their allowing that sort of threat to go unpunished are an enormous suppression of freedom of speech. If that sort of frightening activity was allowed to go on there, as it was allowed also in Birmingham, and if police act in that way when faced with mob violence, then those who are the likely target of that mob violence feel threatened and their free speech is suppressed. It is important that the Government enforce the boundaries. I think we can all agree, at least in their gross aspect, on what is a reasonable reaction and what is a reasonable expression of freedom speech. Carrying placards suggesting that people be murdered or indulging in violence which results in the closure of a play both clearly go over the mark, and neither was properly dealt with by the police, because they felt that there would be no support from the Government if they had taken the sort of action that they should have taken.
	This is a Government who, through a succession of Bills of which the Racial and Religious Hatred Bill was only the most recent example, have been seen to care little for freedom of speech. Even the little examples confirm that impression, such as that of the lady who was arrested and charged for reading out the names of the dead opposite the Cenotaph. Whether the police arrest her or stand by her quietly and say, "Right, you've done your bit. Go on", is a matter on which they exercise their discretion. They exercise that discretion in the understanding of what their political masters wish them to do. The climate is set by the Government, and the Government are setting it against freedom of speech. I really hope that all this cumulative distress will result at some stage in the Government changing their attitude, or to us to changing the Government.

Baroness D'Souza: My Lords, I too thank the noble Baroness, Lady Knight of Collingtree, for initiating this debate, coming as it does in the context of the imminent enactment of recent legislation to which the noble Lord, Lord Lucas, referred.
	This House has repeatedly asserted its belief that freedom of expression and its corollary, the right of access to information, is a vital individual right. I would go so far as to say that it is the cornerstone of democracy, since without information and the freedom to use it to secure other rights, governments quickly become unaccountable, and tyranny can and often does follow. History is replete with examples of how censorship is not only a function of the slide from democracy, but also a cause of it. That is why one has to be vigilant about any curtailment of freedom of expression. Yet it is argued, by some of the more popular press in particular, that hate speech should not be allowed. I think we have to go back to first principles and the laws that govern the difficult area of where the line should be drawn between the expression of emotionally strong views and dangerous incitement, and by whom. Here I declare an interest as a former director of Article 19, an anti-censorship organisation.
	It is the context that determines whether speech is likely to cause criminal action. The famous case of falsely crying "Fire!" in a crowded theatre as compared to shouting from a street corner is still relevant. The argument is that in the former case it is reasonable to expect that injury will occur and that in the latter injury would be unlikely. The key feature of the latter example is that there is the opportunity to avoid both the speech and its effects. That landmark US Supreme Court case has been followed by many others that have helped to build jurisprudence that defines hateful or offensive or insulting speech by its effect on the target and the extent to which the intended victim of such verbal assault is able to avoid it. Thus, rather simplistically, almost anything can be said or written if there is a clear choice about hearing or reading it. If one can walk away from Hyde Park Corner, close the book, not buy the theatre or cinema tickets, then why should speech be censored?
	The exception to this rule occurs when speech, or any other form of expression, occurs within a highly charged context where the speech could itself whip up such strong feeling that damaging action is likely to occur and where those who become emotionally charged have the access and the wherewithal to cause criminal harm. The terrible example of our time is the Rwanda genocide of 1994 where the highly popular local radio orchestrated the mass killing by the Hutus of their more moderate kinsmen and of the Tutsis, a massacre that had been planned for some months previously and that took place in an extremely tense context in which tribal violence, if not common, was certainly within everyone's living memory.
	The furore about the offensive cartoons first published in Denmark last year is alarming but presents an interesting example of the limits of our tolerance. The demonstrations in central London by angry Muslims were indeed offensive to many. The placards were extraordinary, calling for the murder of those who insult Islam. But should they be banned, or should the more extreme demonstrators be charged? No one was obliged to attend the demonstration. We may argue that it should not have taken place, but it did, and as far as one can tell it was not an occasion to prepare further criminal action. It was an expression of hurt and anger. Who is to say that that should be suppressed, with possibly far worse consequences?
	The Abu Hamza case is quite different. Here, young and impressionable men were obliged by tradition to go to the mosque every week and thus to hear outpourings of hate against specific targets in British society. We now learn that Abu Hamza had the wherewithal to provide these young men with the means, either through training abroad or weapons, to carry out criminal actions. That is not free speech; it is criminal incitement and has rightly been judged as such.
	Alien speech is uncomfortable for all of us, as is the expression of violent emotions, but I believe that it is precisely in such moments of heightened feeling that we must remember the basic right to free speech and look carefully at the context in which it occurs. Above all, by permitting these kinds of demonstrations to take place, Britain is encouraging potential political discourse and solutions in place of violence.

Lord Plant of Highfield: My Lords, this is an important debate. There is no doubt that freedom of speech and liberal democracy more generally are under attack from various kinds of fundamentalisms in the modern world. In that context, we need to be clear about the moral basis for liberal democracy and the place of freedom of speech in it. In the view of some critics of liberal democracy, that immediately puts liberalism on the back foot because, in their view, there are no deep values acting as the foundations of liberal society. Let me cite one sophisticated example of this critique from the Muslim philosopher and theologian, Professor Akhtar. His argument is that at the basis of liberalism there is, paradoxically, a type of fundamentalism; what he calls the fundamentalism of doubt. Liberals are fundamentalists. Their fundamental principle is to doubt everything. That is his view.
	So why do liberals, in his view, value free speech and other democratic values? The answer, in his account, is that liberals are in fact sceptics and relativists. They do not know what the truth is, so they need free speech and other liberal values to cope with the basic axiom of liberalism that all beliefs are up for grabs. If that is so, liberalism can have no fundamental moral beliefs of its own. It is, rather, simply a coping mechanism—a way of coping with doubt and scepticism. This puts liberal values on the defensive when confronted with a world view such as fundamentalist Islam, which claims to know what the truth is and has a mission to see that its conception of truth prevails. In his view, the fundamentalism of faith will overcome the fundamentalism of doubt.
	I do not think that that is a true account of liberal values such as freedom of speech, but we need to be clear about the basic values of liberalism and the considerations on which a defence of free speech rests. The first is the idea that so far as an understanding of the empirical world is concerned—an understanding which we acquire through sciences of all kinds—advances in knowledge require an openness of debate and dialogue to provide the context for what Karl Popper called the process of conjecture and refutation. If an open society is necessary for the advancement of empirical inquiry, we cannot easily constrain the exercise of free speech purely to this sort of area.
	Secondly, and perhaps more importantly, in the sphere of morality, we have to acknowledge that there are many important values, such as liberty, equality, justice, mercy, charity, friendship, loyalty, respect for individuals and the claims of community, which are all real and genuine values. Liberals are not sceptical or relativist about the centrality and importance of such values in human life. Nevertheless, it remains true, as Isaiah Berlin constantly argued, that there is no uniquely compelling way of linking these values together in some kind of monolithic or ordered framework. We always need the freedom to debate the relative weight of such values in changing situations. Indeed, we are doing precisely that at the moment.
	The weight given to particular values depends on openness to dialogue and not on assertion and will. It is vital in a diverse society within which people differ on the ways in which various goods should be weighted, that debate contributes to what the American philosopher John Rawls calls "public reason"; that is, a public culture of rational debate about values and principles and what sorts of reasons count in favour of one way of looking at values rather than another. These cannot be settled for society at large by religious or ideological authority, and freedom of speech is an essential part of public reason.
	So should free speech be limited? Usually liberal thinkers have invoked the harm principle; that free speech can be limited when it causes harm to others. Critics of free speech will major on this and argue that feeling insulted and offended is a form of harm, and therefore there should be no freedom of speech to insult and offend. I think that this is a mistake. We need to distinguish between civility and law, and so far as the law is concerned, I believe that this would make limitations on freedom of speech far too subjective.
	If there are to be legally enforceable limitations on free speech, they should be as capable of as much objectivity as possible. This has led liberals to espouse two conceptions of harm: harm to physical security, and the prevention of another person being able to follow his or her own conception of the good. It is argued that most people, whatever their beliefs, would regard undermining their physical security and restricting their ability to follow their most fundamental beliefs as the basic forms of harm. If this is so, the restriction on free speech could be justified by citing either or both of those considerations, and unlike insults and offended sensibilities, they are capable of objective establishment and adjudication.
	It has been said in the past few days that free speech should be exercised responsibly. On the view that I have outlined, if its exercise does not cause harm, then it is exercised responsibly. However, those who make that point about responsibility argue that it should be exercised in a way that respects the belief of others. That argument seems to neglect two aspects of respect: first, that respect should be seen as a reciprocal relationship, and, secondly, that respect must be earned. It seems to me at least that many who demand respect for their beliefs have very little, if any, respect for the beliefs of others and how they live their lives. Respect is a two-way street, and I do not see why I should be expected to respect the beliefs of others when, in the articulation of their beliefs, they show little or no respect for other members of society.
	On the point about respect being earned, I argue that, in a democratic society, beliefs earn respect if adherents to those beliefs accept that it is reasonable for other people to disagree with them; that is to say, they earn respect if they hold their beliefs in a reasonable way, recognising the right of others to disagree. As the right reverend Prelate said, it is fashionable in these post-modern times to decry the values of the Enlightenment and say that there can be no foundations for the democratic values endorsed by that movement. I hope that I have suggested, at least, that that is not the case. We need to be clear about democratic values and their defence. Abandoning the Enlightenment leads us to endarkenment, and nobody wants that.

Lord Inglewood: My Lords, like other speakers, I thank my noble friend Lady Knight for introducing this important and timely debate. If it would not have been greedy to speak twice this afternoon, I would have liked to put on record my concern about, and abhorrence of, the current excesses in Iran.
	I declare an interest as chairman of the Cumbrian Newspaper group, which owns seven regional paid-for titles, a number of free titles and magazines, and a number of radio stations.
	Other speakers have already emphasised how freedom of speech is central to our society, how it is one of its defining characteristics, and that it is axiomatic that all freedoms must be exercised in a manner so as not to deny that freedom to others. In that context, it operates at two slightly different levels: first, at a public level, where the state intervenes to stop racial hatred, civil disobedience and even domestic insurrection and so on; and, secondly, at a private level, through the law of tort, particularly defamation law.
	Although we live in an essentially plural and secular society, we should all recognise that, in the case of religious belief, some forms of expression not only may be offensive in human terms but are more than that because they attack things that are sacramental and universally sacred. I speak as a practising Anglican, but one, I am afraid, who is no textbook example; rather, I suspect, for the benefit of the right reverend Prelate, I am an example of the "Wrong Sort". However, a society where, quite rightly, there is a distinction between Church and state, we must be clear how we deal with this phenomenon. Like the interlocutor of the noble Lord, Lord Dubs, I believe that in the last resort God and the eternal verities can look after themselves. I need them a lot more than they need me.
	One of the most important questions is how our law transfers these general principles into actual action or lack of it in any circumstance. The problem is that, as anyone who has ever held elected office knows, there is always somebody somewhere out there who objects to everything. That being the case, some test of reasonableness must be introduced into the assessment of the facts—just as in defamation cases in which it is the jury's job to determine. How else, otherwise, can we in a plural society deal with widely varying susceptibilities and beliefs? Interestingly, as the noble Lord, Lord Plant, said, it often seems that it is those who are most insensitive towards others and most intolerant who become most sensitive in respect of their own susceptibilities.
	The approach that I have outlined may be a bit rough and ready but it seems to have one universal merit: while it may be rough justice, it is actual justice.
	If, like me, you have stood for elected office as a Conservative in a strong Labour area, the fact that you happen to be an old Etonian, a hereditary Peer, educated at Oxbridge, a barrister, a farmer and a landowner, is inevitably gratuitously handing over to one's opponents a number of metaphorical rotten tomatoes free, gratis and for nothing, to be hurled straight back in your face. It may be unfair, but that is life. That is the world we are in and it cannot be any other way.
	The world is a place of rough and tumble, just as much in the world of words and ideas as of commerce and business. Expressing ideas that others find distasteful in a manner that does not incite or attempt to incite must be a legitimate form of expression. Clearly in that context motive can be a part in defining incitement. Equally, a subsequent publication or issuing of a statement of something already said may have a different characteristic from that of its first publication.
	History shows us a series of ideas that have become discredited by virtue of public debate: the divine right of kings; slavery; witchcraft; or, perhaps more recently, the concept of hereditary membership of Parliament.
	There is a further and most important consideration, which anyone considering expressing a view or reporting a story should consider, particularly one that may hurt or upset someone else, even though it may be perfectly lawful to do what is being proposed. That is whether it is in the public interest and responsible to do so. Journalists, it is often said, honour that axiom more in the breach than in the observance. It is certainly an unfortunate perception; and, if true, is evidence of irresponsibility. The wider freedom that freedom of speech encompasses and is a part of, involves responsibility towards others.
	In the case of the so-called Danish cartoons there should be no law forbidding their publication; but in all the circumstances it is on balance an abnegation of one's responsibilities to do so. I make no apology for explaining that I asked the Library staff if they could produce the cartoons for me. I have a somewhat old-fashioned view that it is on the whole better to inform oneself before forming a view and expressing it; especially in your Lordships' Chamber. They did: they obtained them from the net, which, as the noble Lord, Lord Giddens, said, poses a number of interesting problems. What struck me—as other speakers have mentioned—is that I did not think they were high-class or helpful cartoons.
	However, my point of view, which may be considered excessively libertarian by some, is that if, as I do, one believes that freedom matters a great deal, it must mean that when the push comes to the shove it takes precedence over injured amour propre or hurt feelings.

Lord Monson: My Lords, barely 48 hours ago I arrived back from India where, incidentally, for part of the time my wife and I were guests of a Muslim family with whom we have been friends for almost 50 years; so not until yesterday did I realise that this debate was taking place today. I congratulate the noble Baroness, Lady Knight, not only on her speech but on her immaculate timing. The Motion speaks of the recent developments affecting freedom of speech. I shall confine my remarks, given the time constraints, to the spoken word.
	It is true that matters have grown much worse recently under this Government. However, it must be said that the rot started to set in over four decades ago. I was lucky enough to grow up in an era when traditional British freedom of speech was by and large a reality. The same applies to my contemporary, the noble Lord, Lord Goodhart, who is not in his place at the moment; although he may interpret matters differently—we shall soon know. Of course, that was offset by tighter restrictions on other forms of expression: the theatre was still under the absurd and anachronistic thumb of the Lord Chamberlain; films were more heavily censored than today, albeit largely in line with public opinion at that time; and books were sometimes censored, notably Lady Chatterley's Lover, although in practice it was not difficult to find ways and means of getting around the bans.
	Provided that they did not shout obscenities in public or encourage others to cause physical harm to persons or property, people could say pretty much what they liked in private homes, pubs, clubs, the workplace or on a soapbox. During my teens, my parents lived not far from Marble Arch, and I used to enjoy going to Speaker's Corner. One heard every sort of rant: communist, Trotskyite, Mosleyite and religious zealotry of every hue. There was plenty of heckling, both witty—the most effective kind—and angry, but no one tried to stop the other person saying his piece. People argued and argued fiercely with their opponents, but they did not try to gag them; and rightly the police stayed well away. Even during the understandable mass demonstrations over the Suez misadventure, neither demonstrators nor counter-demonstrators tried to silence the other.
	Then came the 1960s. By that, I do not mean the physical decade starting on 1 January 1960 but the cultural and sociological phenomenon that ran from mid-1962, I would say, until the end of 1974—although Philip Larkin famously put the start date six months later. Ostensibly, it was a time of glorious liberation, and in some respects that was true. However, unfortunately, nonconformity soon became the new conformity, as far as the younger generation was concerned. Opponents of the Zeitgeist were barely tolerated. Above all, political opponents were no longer to be engaged in intelligent argument but to be silenced altogether, in true Maoist style.
	It first became apparent during the demonstrations over the Cuban missile crisis and reached its peak during the Vietnam war. "Uncle" Ho Chi Min was virtually worshipped by most students and by what we now call the chattering classes. Of the well known commentators, only Bernard Levin and Kingsley Amis had the courage to stick up for the South Vietnamese anti-communists, many of whom were later to become the boat people. When the anti-communists booked Kensington town hall to put their case—calmly, to an invited audience—they were besieged by a mob of screaming fanatics and forced to flee.
	Next came the Californian eccentricity of political correctness, which, before long, spread throughout the English speaking world—including Australia, of all unlikely places—and which further constrained free speech. So far, the Government cannot be directly blamed for all this, except perhaps for enthusiastically endorsing excesses of political correctness. However, recently we have seen some extraordinary developments—for example, as has been mentioned, the law that severely restricts protests within one kilometre of Parliament, despite the fact that no corresponding restrictions apply to protests outside the White House in Washington, as I have observed. This law caught a woman who was doing nothing worse than reciting the names of the war dead.
	Next, the Prime Minister himself, no less, was investigated by the police for remarking, in private, that the Welsh were a pain in the backside. Actually, he used much stronger language that cannot be repeated in the House. The police were similarly diverted from their rightful tasks of chasing burglars and car thieves into investigating, as the right reverend Prelate the Bishop of Durham said, moderate criticisms of homosexual practices made by, among others, the right reverend Prelate the Bishop of Chester, the author Lynette Burrows and Dr Iqbal Sacranie, a prominent Muslim—even though the comments were entirely legal.
	One cannot help suspecting that senior police officers fear that their chances of appointment and promotion will be lessened unless they pursue new Labour's PC agenda with the utmost zeal, whether or not the law actually dictates it. That is an unsatisfactory, and even dangerous, state of affairs.

Lord Soley: My Lords, I also congratulate the noble Baroness on introducing the debate, although I suspect that the agenda might have moved on a little from what she had in mind when she originally tabled the Motion.
	I do not share her rather dismal view of the present situation or that of the right reverend Prelate the Bishop of Durham, not least because freedom of expression flows deep in all types of British veins—we ought to be proud of that—and also because I have seen many arguments over individual issues come and go. The noble Baroness, Lady Knight, will recall that when she was a Member of the then government party in the House of Commons and I was on the Opposition Benches, she strongly defended the banning of Sinn Fein from appearing on any radio or TV station anywhere. That was the first time that we had banned the elected representatives of a political party from appearing in the press.
	I remember the miners being summoned and arrested for selling copies of the Miner for precisely the same reason, incidentally, as the lady in Downing Street—because there were rules about getting police permission before doing so. I have reservations about that, but that was done for that reason. I simply say—I shall give way to the noble Baroness, if she wishes me to—that such issues come and go, and we can and do deal with them in both Houses of Parliament. That is not the fundamental problem that is challenging us today. That is what I should like to move on to, but I happily give way.

Baroness Knight of Collingtree: My Lords—

Baroness Farrington of Ribbleton: My Lords, were the noble Baroness to intervene now, there would be no time for her to say anything at the end of the debate.

Lord Soley: I thought I was going to get injury time, my Lords.
	Religious leaders are leaning over backwards to try to build bridges, but something very important has happened over the past 10 or 15 years. I do not accept the idea of a change of climate so much as a radical shift from a clash between political ideologies—communism on one side, led by China and the USSR, as it was, and on the other western Europe and the United States—to a clash between religious belief systems. These ideologies—they are both forms of ideology to me as a non-religious person—produce an intense belief that people are prepared to fight for and die for. Religious wars are no better than political wars if you get into that ideological struggle. It has been one of my arguments for some time that, when a political ideology declines, a religious ideology often emerges to replace it, and vice versa. There is a lot of evidence for that in various parts of the world at various times.
	In the present climate—my noble friend Lord Dubs was right about this—we have to defend freedom of speech very powerfully. That does not mean that you exercise it without thought and consideration for other people. I have the freedom to make faces at my neighbour; I do not do it—it would not be sensible to do it. Similarly, if you are going to exercise freedom of speech, you have to ask yourself about the way in which it will impact on the people who may suffer from its consequences.
	I was struck by what the noble Lord, Lord Monson, said. He is absolutely right: there were many examples of slight erosions, as they were regarded, of freedom of speech many years ago. That is why I say that it is not new, aside from the ideological clash. In the 1940s particularly, a real problem with freedom of speech was that, if you were from an ethnic minority, you had to suffer abuse—real abuse. The noble Lord talked about being politically correct, but the laws were introduced to protect a minority. Of course, you can define a democracy as the majority will, but if you ignore the rights of the minority, you have a very poor democracy, and I think that that is part of the equation.
	If I am right about the clash of religions, it is important that we in the West understand that the argument is largely within Islam. It has to be within Islam. We can talk about what we would like, but in a real sense there is a struggle within Islam, a struggle over modernisation. My strong belief is that the modernisers will win. The vast bulk of Muslim opinion is strongly in favour of freedom of speech, freedom of worship, freedom of belief, democracy and the rest. If we recognise that, we recognise something important.
	The other part of the problem has to do with two events in the past week or so that have made the noble Baroness's debate so important. On one hand, there was the provocation by a group of extremist Islamists carrying placards urging the killing of other people and so on. On the other hand, Nick Griffin of the BNP walked out of court saying that Britain was like Bosnia. Britain will be like Bosnia only if the extremists of that Islamic group or of the BNP actually win. It is our job—our duty—to make sure that they do not.
	The police probably did the right thing in not arresting the people carrying placards last week, but I very much hope that they follow this up. There is profound danger if we allow things like that, which provoke the rest of the population and open up the divide on race and religion again. That is what produces real danger for all of us and poses a real danger to freedom of speech, not some of the lesser issues that we can deal with in the normal course of events.

Lord Goodhart: My Lords, I am also grateful to the noble Baroness, Lady Knight of Collingtree, for introducing this important debate. I agree with much of what she said, although some of her examples concerned rather silly, self-imposed political correctness, rather than any actual restrictions on freedom of speech. However, I hope that she will excuse me if, like my noble friend Lady Falkner, who made a brave and impressive speech, I concentrate mainly on the issue that has dominated the media throughout the past couple of weeks—the Danish cartoons. The issue is topical, it is important, and it raises and illustrates many of the threats and problems of freedom of speech.
	As the noble Baroness, Lady D'Souza, said, the great American judge, Oliver Wendell Holmes said that the right to freedom of speech did not include the right,
	"falsely to shout fire in a crowded theatre".
	The question is whether Jyllands-Posten, the newspaper that published the now notorious cartoons, shouted "fire" in the theatre. It is widely known that pictorial images of the Prophet Muhammad are offensive to most Muslims, whatever the nature of the pictures. The cartoons clearly went beyond mere images because some of them carried messages linking the prophet to terrorism. Publishing the cartoons was misguided, irresponsible and possibly also hypocritical because apparently, three years ago, Jyllands-Posten refused to publish cartoons of Jesus Christ on the grounds that that would offend its readers.
	It was a wise decision of the United Kingdom media not to republish the cartoons. It would have been grossly irresponsible to do so at a time when thousands of British troops are serving in Iraq and Afghanistan. But should the publication be illegal? In my view—I think that most speakers have agreed with me—the answer is "No". I agree very much with the noble Baroness, Lady D'Souza, that freedom of speech is one of the basic pillars of a democratic society. Indeed, its special importance is recognised in Section 12 of the Human Rights Act 1998. Of course, it is not an absolute right, but under that Act restrictions must be strictly limited. To prohibit the publication of matter that is offensive to a section of the community is to give that section a veto over the freedom of speech of the rest of the community. In principle, that is unacceptable.
	Should it be the rule, then, that we can say things that cause offence to other sections of the community, only if we say them in some serious or responsible way? I do not think that that is much better. It is difficult to distinguish between arguments carried on in the voice of what we used to call the broadsheets and arguments carried on in the voice of the tabloids, so I do not believe that speech should be banned simply because some people who hear it will be offended or because those who speak it are behaving irresponsibly. Freedom of speech is a freedom for satire, lampoons, bad-taste jokes and not just for serious and responsible argument.
	To return to Oliver Wendell Holmes, when are we shouting "Fire"? Let us look at the metaphor. Shouting "Fire" when there is not one is wrong because it may lead to panic or stampedes in which people might die or be hurt. In this context, the test is: are the words or, in this case, the pictures intended to encourage violence against another section of the community or provoke hatred of that section? On that test, the cartoons do not seem to me to be shouting "Fire". They are not likely to increase hatred of Muslims or violence against them. They will appeal only to those who already hold hostile views. But there is a more difficult question. If violence is the test, should it be illegal to publish material that is not so much intended to encourage violence against those who are the targets of that material, as to provoke violence by the targets in order to ratchet up the divisions in the community? That was the effect—to some extent, perhaps, the intention—of the publication of the cartoons by Jyllands-Posten. That is the strongest case that can be made against that newspaper.
	It is not an altogether easy question to answer. As I said, it is obvious that you cannot give any section of the community a veto, simply because it says that it will riot if you criticise it in particular ways. Yet I can imagine circumstances, in times of intercommunal violence, when a government might find it necessary to ban the publication of material intended to provoke violence by people of the opposite viewpoint. That would be permissible under Article 10.2 of the European Convention on Human Rights as being necessary for the prevention of disorder or crime. Any ban would have to be temporary, exceptional and spelled out in law in order to come within Article 12. I do not think that the circumstances now exist that would justify such legislation.
	We should also look at the reverse of the picture: what about the rights of the demonstrators against the cartoons to express their views? The demonstrators who were carrying placards calling for the beheading or massacre of those responsible for the cartoons were, plainly, inciting murder. They are plainly shouting "Fire" in Justice Holmes's theatre. Whether it is right to prosecute them is a matter for the police and the Crown Prosecution Service, and I would not be critical of the restraint shown by the police at the demonstration last weekend. Some of the demonstrators may have been deliberately provoking arrest in the hope of stirring up over-reaction by the police and getting the sympathy of moderate Muslims. It should and must be the objective of the police in the future to prevent the display of placards inciting murder. On this issue only am I not in entire agreement with the noble Baroness, Lady D'Souza. The BBC's "Today" programme also made an error of judgment in giving airtime to the repulsive views of Omar Bakri Mohammed.
	The debate is extremely important, as it shows the importance of freedom of speech and the difficulty of deciding where it stops. I agree with many of those who have spoken. I have some difficulty with some of them and am not in agreement with the views of the right reverend Prelate the Bishop of Durham, who rather reflected the viewpoint attributed to Professor Akbar in the speech of the noble Lord, Lord Plant. This does not give sufficient attention to the position of those who, like myself, do not have religious faith. Perhaps I have misunderstood it—the right reverend Prelate is indicating that I have—and I will certainly look at it again.
	I also agree with the noble Lord, Lord Dubs, that this is not such a clear case as that of the Satanic Verses, where the reaction of some fundamentalist Muslim groups was a reaction of bigotry and not one of faith. Jyllands-Posten was knowingly offensive to Muslims. It was at best irresponsible and may possibly have been deliberately provocative. The same is true of newspapers in other countries that have reprinted those cartoons. Yet I believe that the law should not prevent the publication of material that is offensive to some on religious grounds. The right to freedom of speech is a vital defence for all in a multicultural society. In very recent times, the Government have, in the Racial and Religious Hatred Bill and the Terrorism Bill, made unjustified attacks on the right to freedom of speech.
	The right to freedom of speech is a vital defence for all in a multicultural society; all groups must be able to explain and, when challenged, justify their points of view. All of us will be weakened is freedom of speech is restrained.

Lord Kingsland: My Lords, like so many of your Lordships, I add my thanks and congratulations to my noble friend Lady Knight of Collingtree on her incisive and perspicacious speech. We are fortunate, too, that it has taken place at a time when many of the issues that she intended to include in her speech have been given even greater relevance by current events.
	I entirely agree with everything that has been said by those of your Lordships who addressed the principles that lie behind the doctrine of freedom of speech. I was particularly interested, as I am sure that all your Lordships were, in the observations made by the noble Lord, Lord Plant of Highfield. Freedom of speech is fundamental to the principle of minority rights; and as the noble Lord, Lord Goodhart, said, that is particularly important when a society has minorities that espouse different, deeply held, religious beliefs. But it is equally important to note that a majority government benefits from freedom of speech—because, if minorities have the right to express their views, they have the consolation that even if the majority takes the different view, at least those minorities have had an opportunity to influence majority thinking. So both minority rights and majority rule are enmeshed by the principle of freedom of speech.
	As many of your Lordships have observed, particularly my noble friend Lord Inglewood, freedom of speech is not a comfortable constitutional doctrine to live with. People who are at the wrong end of observations of other members of society are often the subject of some very critical and sometimes distasteful remarks—even abusive and insulting ones. Yet those are essential ingredients to the doctrine of freedom of speech. A society, to incorporate successfully freedom of speech, has to have a very well developed sense of humour; and the cartoon, in my submission, is a vital component of freedom of speech, because, if the cartoonist is good, the reaction of the reader initially is one of humour. Is the cartoon is good, the cartoonist is seeking to ridicule people in power—the most damaging weapon that can be used against a sitting government.
	But I agree with all your Lordships that the cartoons that appeared in the Danish press totally failed to meet those vital principles; it was, indeed, unwise to publish them—though I also agree with the noble Lord, Lord Goodhart, and other noble Lords, that legally they certainly could be published.
	The second difficulty with the principle of freedom of speech is that it is not an absolute principle. You only have to look at Article 10 of the Convention on Human Rights to see that the doctrine is qualified by other important social objectives, such as public security and public safety. So, in any given set of circumstances, the police, and other authorities that have power over the ability to express freedom of speech, must engage in a balancing act to reach a decision.
	Indeed, with some of our most important laws, that balancing operation is inherent in construing what the law means. For example, the law of peaceful public assembly states that the continued legality of that assembly depends, in part, upon the reaction of those who are present for an initially peaceful reason. Quite often, because of the reaction of others around those engaged in peaceful assembly, something that was originally not a crime may become one. Once again, those in authority have to make a fine judgment about whether to bring a prosecution.
	The noble Lord, Lord Goodhart, had an extremely pertinent question when he asked upon what we should focus. Should it be on the incitement by the banners of those manifesting, or on the reaction of those who observe that manifestation? Was the intention to incite violence, or to provoke others to violence? Those are all crucial questions, which the police have to take into account before they decide how to react.
	Another factor, aside from the circumstances of a particular case, is the circumstances of the nation. The approach of the authorities to freedom of speech in the 1930s was very different from that of the authorities in the course of the Second World War, when the nation was under threat. What you might or might not say about fascism or national socialism in the 1930s you could not say in the 1940s, and for good reason. The balancing act came out with a different solution, because of the overriding importance of public security. That is one reason why we have particular difficulty in making that balance today; for we live in a world of international terrorism. We have no idea when we will next be hit by a terrorist act. Are we in a state of war or of peace? In a sense, the problem that the authorities face today is much more difficult than that which they faced in the 1940s.
	As the noble Baroness, Lady Falkner of Margravine, said, when we come to pull the strands of these issues together it is absolutely vital that those who have the authority to prosecute act in a totally even-handed manner. That is, across not just particular activities but across all ethnic groups. Indeed, if they do not we will lose confidence in them.
	My noble friend Lady Knight placed particular emphasis on the growing disease of political correctness, and rightly so. The right reverend Prelate also had a number of extremely pertinent observations to make on that. Frankly, I am outraged at some of the investigations that the police have made into perfectly legal observations made by members of different ethnic groups about matters where they were, in any case, only responding to questions asked by interviewers.
	I am also extremely disappointed in the way that the police have operated Section 132 of the Serious Organised Crime and Police Act 2005. What was originally intended to protect Parliament is now being used to protect the executive offices in Whitehall as well. Some of the arrests that have been made have, frankly, done much more to discredit the police than they have to enhance public security.
	Different views have been expressed by your Lordships about whether arrests ought to have been made in the course of the demonstration in front of the Danish embassy. It is difficult for those of us who were not there to take a final view on that; as with the jury in a court, you can only come to a correct conclusion if you have heard all the evidence in court and have been influenced by no other. In those circumstances, one must always allow the police a margin of appreciation. However, having seen some of the banner texts, had I been there—given that I am making these observations at a distance in both space and time—my inclination would have been to make some arrests. The key is for the police to be even-handed. That is the issue on which I am most interested to hear the Minister as he gets up to respond to the debate.

Lord Bassam of Brighton: My Lords, my first duty is to congratulate the noble Baroness, Lady Knight of Collingtree, on obtaining an important and timely debate. As a noble Lord observed, she could hardly have thought that the debate would have taken off in the way that it has, given events over the past week or two, which are continuing to unfold. The noble Baroness caught some of the mood and flavour of that in her exposure of some of the contradictions, as she saw them, in the expression of opinions and the detail of "political correctness", as she described it.
	I congratulate all other noble Lords who have taken part in this good and vigorous debate. I have listened carefully to it and I intend to read it carefully. I have listened in particular to the previous two speeches, which along with all the others, will require close reading and in which points were well made.
	I was intrigued by some comments. The observations of the right reverend Prelate the Bishop of Durham about a change in the moral climate were interesting, although clearly provocative to some. I found myself easily agreeing with my noble friend Lord Dubs when he rightly said that freedom of speech was a guarantor of the protection of minorities; that view was echoed by others, including the noble Lord, Lord Kingsland. The noble Baroness, Lady D'Souza, reminded us that we should revisit first principles. She was right to do that and, indeed, some speeches took us back to those principles.
	I could not agree with the noble Lord, Lord Lucas, that this Government had been irresponsible regarding freedom of speech issues and had been chipping away at it. However, I did agree when he said that the press had perhaps become more responsible over the past couple of decades. However, an interesting article by Roy Greenslade in the Daily Telegraph this week questioned the basis of that new responsibility, suggesting that trusting markets was a bigger explanation than most.
	I certainly agreed with the noble Lord, Lord Giddens, when he said that there was an ongoing battle between fundamentalism and cosmopolitanism. I side with him in looking for the victor.
	I was amused on hearing the noble Lord, Lord Inglewood. It was the first time that I have heard someone claiming that there was a disadvantage to his life in being an old Etonian. The noble Lord should visit the kitchen Cabinet of Mr Cameron, who may put him right on that.
	I could barely disagree with my noble friend Lord Soley's correct assessment that while these are important issues now, they are issues that come and go. The noble Lord, Lord Monson, took us back to the days of the Suez conflict and reminded us how the Lady Chatterley's Lover court case had been variously interpreted at the time as an attack on freedom of speech and expression. The echoes regarding a consistent application of the law were a theme picked up neatly by the noble Baroness, Lady Falkner of Margravine, and came through in the debate.
	Freedom of speech is central to the proper functioning of parliamentary democracy and of a free society. I doubt whether anyone in your Lordships' House would disagree with that. This Government are committed to upholding the right of freedom of speech and they have done a great deal to protect that freedom since taking office, particularly through the Human Rights Act 1998, which ensured that the right of free speech, contained in Article 10, along with other rights, of the European Convention on Human Rights, is brought directly into effect in our law, and that the courts must interpret the law compatibly with those rights.
	We must all recognise that there are limitations on what can acceptably be said. Freedom of speech is not an absolute. The debate reflected that; the noble Lords, Lord Goodhart, Lord Giddens and Lord Kingsland, made it very clear that that was very much how they saw the matter. There are, as there must be, consequences when people go beyond those limits. There have always been restrictions to the freedom of speech; the European Convention on Human Rights itself states:
	"The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society in the interests of national security, territorial integrity or public safety; for the prevention of disorder or crime; for the protection of health or morals; for the protection of reputation or rights of others; for preventing the disclosure of information received in confidence; or for maintaining the authority and impartiality of the judiciary".
	For example, if we use racist language, if we encourage child abuse, or if what we say is intended to incite hatred or provoke violence, we accept that there should be consequences, and that such things should legitimately be caught by the law.
	It is right that there should be thorough and lively debate whenever the boundaries of free speech are tested. We have heard a lot of such debate in recent months; today's debate is part of that. Before responding to some of the specific points raised, I would like to cover some issues more generally. First, I would like to say a few words about the cartoons, to which everybody has referred, that have caused so much controversy over the past week. As the Home Secretary said on Monday:
	"In Britain, the response to the publication of the Danish cartoons has, in general, been respectful and restrained".
	This is the best tradition of British tolerance and understanding and we welcome that. We and our EU partners stand in full solidarity with the Danish government in resisting the violence that has arisen. Nothing can justify the violence aimed at European embassies, or in Denmark. We understand the offence caused by the cartoons depicting the prophet, and regret that this has happened. Freedom of expression must be exercised with respect for the views of others, including their religious beliefs. Such attacks as we have seen on the citizens of Denmark and other European countries are completely unacceptable.
	For this reason, we must ensure that the law is properly formulated to deal with the kinds of situations that arise. We accept that there will be debate on each occasion when it is proposed that the law is changed, but we do not apologise for seeking change when it is required. By way of example, perhaps I could briefly turn to the Terrorism Bill. I do not wish to say too much about this, because I have little doubt that it will return to your Lordships' House. I do not believe that the Bill imposes undue restrictions on free speech. The Bill creates new offences of encouragement to terrorism and dissemination of terrorist publications. These offences can only be committed if the person concerned intends by his actions to incite acts of terrorism, or is subjectively reckless in that regard. I am sure I do not need to rehearse all the arguments we have had on this matter, but that, plainly, is our view. Any restriction on what may be said or done is, on some level, regrettable. However, as we have heard today, free speech can never be absolute. No one has a right to express publicly sentiments designed to provoke others to commit terrorist atrocities.
	While we are in this field, it is only right that I say something, too, about the Racial and Religious Hatred Bill. The Government believe that, as originally drafted, the Bill did not impact upon anyone's ability to joke, discuss, debate or to speak in any number of ways about religion or belief. The original Bill struck the right balance between catching those who seek to stir up hatred and the right to criticise and ridicule religion. However—and the Government must accept that this was the case—there was widespread support in the other place for the amendments voted in by this House. The Bill, as passed by Parliament on 31 January, therefore now contains a comprehensive freedom of speech clause, specifically stating that matters such as discussion, debate, criticism, expression of antipathy, abuse, insult, ridicule or attempt to convert people from one faith—or lack of faith—to another faith will not be covered by the Bill's provisions.
	We believe that this gives the reassurance many have sought. An artistic performance that dealt with an issue of religion or belief in a controversial way could therefore proceed in the knowledge that it would not be unlawful. For example, much has been made of the production of "Jerry Springer—The Opera". As I said, the Government uphold freedom of expression, provided that it does not stir up hatred or violence. Theatres make their own decisions on which productions to mount. The BBC took the decision to show "Jerry Springer—The Opera" independently of government. Although it is clear that its production and screening has caused offence, there is no evidence that it has stirred up hatred against any religious group and it would not be caught by the proposed incitement to religious hatred offence. It would not have been caught by the Bill in our preferred form.
	Similarly, although it was already an offence to stir up hatred against Sikhs under the current incitement to racial hatred offences, whether because of their race or religion, the police decided that there were no grounds for action against the play "Behzti", which some Sikhs felt targeted their community. That was right, although the police faced a difficult task in policing the demonstrations against it, and in the end the theatre withdrew the play.
	Much has also been made in the press recently of examples of how religious freedoms are under threat. In particular, there is a view that the Christian faith is under attack, that councils will no longer support Christmas, and that Christian preaching and Christian symbols are frowned upon. I make it clear that the Government do not seek to prevent local authorities or, for that matter, anyone else being involved in carol services or any other religious celebrations or activities where they feel that it is right to be involved. What is right is that public authorities treat people of all faiths and none fairly.
	Part 2 of the Equality Bill, which outlaws religious discrimination by public authorities, in the provision of goods, facilities and services and in education, and which was recently before your Lordships' House, does not make it unlawful for public bodies to celebrate Christmas, and it will not require the removal of Bibles from hospitals or the banning of Christian symbols. It is not in anyone's interests for councils to ban such events, and I do not believe that people from minority faiths want to see such things stopped.
	However, it is also crucial that the Government work together with all faith communities to improve their capacity to fight extremism and distortion of their faiths and so protect our young people from recruitment to violence. We are determined to work in partnership with the Muslim community to root out extremism and tackle the causes of radicalisation among a minority of our young people. To that end, we are meeting individuals and organisations from across the Muslim communities to discuss where the Government can support them in taking forward recommendations from the Preventing Extremism Together report, as well as other initiatives.
	The issue of when free speech should be curtailed in the interests of the protection of individuals or society is clearly highly sensitive. The Government are committed to maintaining free speech in this country and the proud tradition of tolerance that we have inherited. To do that, we need to adapt to the new challenges that arise, to work out the boundaries that have to be applied, and to work with all our communities to ensure that both tolerance and free speech are as real for our children as they have been for us. To that end, such matters will always, I hope, be the subject of profound and thorough debate in this place whenever they arise, as they have today.
	Important points were raised in the debate, and I shall try to run through them as I come to a close. The noble Baroness, Lady Knight, rightly asked why Abu Hamza was not prosecuted earlier—a question very much in the public eye. As the Crown Prosecution Service and the police made clear in a recent public statement, despite information being submitted to the CPS on two occasions prior to 2003, at that stage it was felt by those authorities that there was insufficient evidence to charge Mr Hamza with any offence. I draw the noble Baroness's attention to an important letter in today's Daily Telegraph on that point from Ken McDonald, the Director of Public Prosecutions. It sets out from a prosecutory perception, and the CPS's view, how the prosecutions of Mr Hamza and Mr Griffin took the time that they did. He states clearly in the letter that there was evidence of a parity of approach, and we have to take that at face value.
	The noble Baroness also referred to the Maya Evans arrest and made reference, as did others, to Parliament Square. The noble Lord, Lord Kingsland, raised the question about the use of the provisions of the Serious Organised Crime and Police Act. Provisions from that legislation have been enforced since 1 August last year. The majority of organisers have applied for authorisation to demonstrate, and I am advised that some 66 demonstrations have taken place with an authorisation. However, some groups have tested the legislation, perhaps provocatively, and there have been 23 arrests for taking part in unauthorised demonstrations. In all those cases, the organisers had not properly applied to the Metropolitan Police for an authorisation.
	It is a longstanding tradition in this country, as the noble Lord, Lord Kingsland, rightly argued, that people are free to gather together and demonstrate their views, provided that they do so within the law. Equally, access to Parliament must be maintained, and those living and working in and around the building should be able to do so in safety and free from harassment. But, as the noble Lord, Lord Kingsland, said, there has to be a balance between the rights of those working around Parliament and the rights of protesters. The noble Lord was right to say that difficult and fine judgments have to be made.
	The noble Baroness, Lady Falkner of Margravine, asked a question, on which she had given advance notice, about the commission on faiths. I am conscious that the noble Baroness wants that to be set up soon, and I share that sense of urgency. Consultation with faith leaders and what are described as wider stakeholders working towards the development of the commission, were sent out in the autumn. The Home Secretary is now considering what the consultation means and how it will affect the scope and work of the commission. We are all hopeful that those considerations will be completed so that progress can be made. It is an important body and, as the noble Baroness argued, it is probably more important now than when it was first considered.
	The noble Baroness also drew attention to what has been described as the police under-reaction to the recent protests, as did the noble Lord, Lord Soley. The Metropolitan Police have set up a post-event investigation to review evidence gathered by the specialist officers who attended the demonstration last weekend, which includes video and sound recording, CCTV and officers' written records. I am advised that the police will pass evidence to the Crown Prosecution Service to make a proper judgment on whether an offence has been committed. That has to be right. It is the professional body, which is independent of politics and the Executive. I can see the noble Lord, Lord Goodhart, nodding because he made the point that it is for the CPS to make the decision on whether it is proportionate and right to proceed.
	This has been a useful debate. I have certainly learnt something from it. The contributions have been powerful and the debate needs to continue. We in government believe in freedom of speech and in people's right to protest. It is fair and proportionate that there should be a measured response. Of course we need to be vigilant at all times. Again, I congratulate the noble Baroness. She has done a first-rate job in bringing the debate forward, and I hope that it is not the last time that we have the opportunity to reflect and consider the important issues that she has raised in her perspicacious way and with such thoroughness and great articulation. I congratulate all the others who have added to the sense that it is a debate for now and also one for the future.

Baroness Knight of Collingtree: My Lords, I am grateful for the timely and wise advice I received from the government Front Bench. In commenting gently on the speech of the noble Lord, Lord Goodhart, I suggest that it is as serious to curtail free speech on the basis of political correctness as it is to curtail it on any other basis.
	On the remarks of my noble friend Lord Soley, my objection to giving Sinn Fein air time was that it was killing not only British soldiers at the time, but innocent British citizens, and urging others to join them in murdering and wounding. I made it clear that that kind of action could not be under the heading of free speech.
	I am most grateful to all noble Lords who have been kind enough to take part in this debate, and to give such thought and care to what they have said this afternoon. It is worth thinking about the point that, perhaps 200 years from now, people in this House may quote, from the everlasting Hansard of 9 February 2006, some of the comments on free speech made here. I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

Industrial Training Levy (Construction Board) Order 2006

Lord Davies of Oldham: rose to move, That the draft order laid before the House on 9 January be approved [14th Report from the Joint Committee]

Lord Davies of Oldham: My Lords, with the leave of the House I will also speak to the Industrial Training Levy (Engineering Construction Board) Order 2006. These orders seek authority from the Construction Industry Training Board and the Engineering Construction Industry Training Board to impose a levy on employers in the industries which they cover.
	Skills are vital to succeeding in an increasingly competitive global economy. The Government have made, and continue to make, major investments in training. This year, the Learning and Skills Council will fund further education and training to the value of £7.6 billion. Last year, we published our White Paper Getting on in business, Getting on at work, which set out our plans for the next major phase of reform for making this country a world leader in skills. We want to ensure that employers have the right skills to support the success of their businesses, and that individuals gain the skills they need to be employable and personally fulfilled.
	In support of that aim, we have established a network of 25 sector skills councils—SSCs—to ensure that employers have a strong, clear voice to influence the provision of education and training. We have also promised that, where both sides of industry in a sector agree, we will help set up a statutory framework for training, as we are currently working with the film industry to do.
	The two industrial training boards—ITBs—are models of the successful application of such frameworks. They are non-departmental public bodies set up under the Industrial Training Act 1982. Their role is to ensure that the quantity and quality of training are adequate to meet the needs of the industries they cover. They provide a wide range of services, including setting occupational standards, developing vocational qualifications, delivering apprenticeships and paying direct grants to employers who carry out training to approved standards. In fact, the CITB, in partnership with CITB Northern Ireland and the Construction Industry Council, operates as ConstructionSkills, the sector skills council for the construction industry. It has developed one of the first sector skills agreements, and that now underpins every facet of CITB's operations.
	The engineering construction industry does not meet the minimum size criteria for becoming an SSC. I am pleased to say however that it has a memorandum of understanding with the Sector Skills Development Agency that firmly locates it in the Skills for Business Network. The board's status as a valuable sector body was further recognised last year when it won an award from Sector Skills Alliance Scotland as the:
	"Most Effective Sector Skills Council or Sector Skills Body in Scotland".
	The Industrial Training Act contains provision for a levy on employers to finance an ITB's activities and to share the cost of training more evenly between companies in an industry. It is for the employer members of a board to make proposals for the rate of levy for the industry it covers, and for the Secretary of State to make an order giving effect to the proposals.
	That is the purpose of the two orders before us. They give effect to proposals submitted to us for a levy to be collected by the CITB in 2006 and the ECITB in 2007. Both involve the imposition of a levy in excess of 1 per cent of payroll on some classes of employer. The Industrial Training Act requires such orders to be approved by affirmative resolution in both Houses. It is that affirmation which I seek today.
	In each case, the levies are based on employers' payrolls and their use of sub-contract labour. For both boards, the proposals involve levy rates in excess of 0.2 per cent, with no exemptions other than for small firms. In such cases, a levy order can be made only if the proposals are necessary to encourage adequate training in the industry and if one of three conditions is satisfied. The first condition is that the proposals have the support of organisations representing more than half the employers, who together are likely to pay the majority of the levy. The proposals from both boards meet that condition.
	The Act requires ITBs to exclude small firms from the levy, but it does not set a minimum-size threshold. Each of these proposals sets a level that the industry considers to be appropriate. Employers who fall below the threshold are not however precluded from benefiting from grant and other support from the boards, and many of them do so.
	In the order before your Lordships, the CITB proposes that both its levy rates this year should stay at the same level as that approved by the House last year. The rates will be 0.5 per cent of payroll for direct employees and 1.5 per cent of net expenditure on sub-contract labour.
	Employers whose combined payroll and net expenditure on sub-contract labour is less than £69,000 will not have to pay the levy. This figure represents an increase from last year's threshold of £64,000 to reflect wage inflation within the industry. The level equates to an employer who employs three people full time throughout the year. Forty one per cent of employers come into this category.
	A further 22 per cent of employers will not be assessed for, or will not pay, the levy for other reasons. For example, they may be in their first year of registration with the CITB or have ceased trading all together. This means that around 60 per cent of employers will not be required to pay the levy.
	The higher levy rate on sub-contract labour is due to the fact that, according to the industry, the vast majority of training is carried out by those employers who have a directly employed labour force. Employers who opt to use sub-contract labour tend to have a transitory arrangement with their sub-contractors and are not normally involved in their training.
	It is encouraging to see that the large contractors, who use significant amounts of sub-contract labour, are recognising their responsibility to contribute more than just cash to tackling the skills shortages in the industry. They have initiated action to encourage firms in their supply chains to recruit and train apprentices.
	The ECITB also proposes to make no changes to last year's rates. The rates for sites will be 1 per cent of total payroll and net expenditure on sub-contract labour. Contractors whose combined payroll and net expenditure on sub-contract labour is £275,000 or less will not have to pay the levy. The level is unchanged from last year and equates to an employer who employs 15 to 20 persons full time throughout the year. It is expected that 62 per cent of sites will be exempted.
	For head offices, the rates will be 0.18 per cent of the total payroll and net expenditure on sub-contract labour. Head offices whose combined payroll and net expenditure on sub-contract labour is £1 million or less will not have to pay the levy. This level also is unchanged from last year and equates to an employer who employs around 40 persons full time throughout the year. It is expected that 80 per cent of head offices will be exempted.
	These proposals are expected to raise between £145 million and £150 million for the CITB, and £10.5 million to £11 million for the ECITB, which covers a much smaller industry. It is worth pointing out that the CITB currently returns £1.74 in direct and indirect training support for every £1 of levy received. For the ECITB, the figure is £1.45.
	Noble Lords will know from our annual debates that the CITB and the ECITB exist because of the support they receive from employers and employer interest groups in their sectors.
	There is a firm belief that without them there would be a serious deterioration in the quantity and quality of training in these industries, leading to a deficiency in skill levels. This was confirmed by reviews of both boards carried out by the Government in 2003, which found that the principle of the levy is still strongly supported in each industry. The boards' own annual employer surveys also demonstrate strong support for the principle of a levy system. The orders will enable the two boards to carry out their vital responsibilities in 2006. I beg to move.

Moved, That the draft order laid before the House on 9 January be approved. [14th Report from the Joint Committee].—(Lord Davies of Oldham.)

Baroness Buscombe: My Lords, this is an important, if somewhat technical, matter that is worthy of consideration. The Minister has made a good case for the continuation of the levy, setting it in the context of the industry's importance. As he said, the Industrial Training Act 1982 established industrial training bodies to ensure that the quantity and quality of training adequately met the needs of the industries for which they were established. The 1982 Act also contained provisions for the levy on employers to finance ITB activities and share the cost of training more evenly between companies in the industry.
	There are two ITBs covering the construction and drilling industries, as we can see from the orders before us, and we are taking those matters together. Both boards provide a wide range of services and training initiatives, including setting occupational standards, providing vocational qualifications, delivering apprenticeships and paying direct grants to employers who carry out training to approved standards.
	These matters are significant because of the context in which we are considering them. Your Lordships will be familiar with the work of Kate Barker and her review of housing supply. Regardless of what one may think about some aspects of the report, one problem that Kate Barker identified, and on which we all agree, is the paucity of skills in the construction industry. That will act as a bar to the delivery of the targets that her report established as necessary. Indeed, the Government, in their own policy, have endorsed those targets. Undoubtedly, we will be unable to build on the scale proposed without significant improvement in the quantity and quality of skills available to the construction industry. I think it important to note at this juncture that, having followed the debate on these orders in another place, while we support them, we do not want to be diverted into the intricacies of house building policies. The Minister will know that I am referring to the failed attempts by the honourable Member for Normanton, Edward Balls MP—I think he prefers to be called "Ed"—to ensnare my honourable friend John Hayes.
	However, it is worth saying a word about the Barker review. Mrs Barker warned:
	"The track record of the industry, in areas such as consumer satisfaction, skills, innovation and local acceptance, is not sufficiently strong to inspire confidence in policy makers that it can deliver".
	That is worrying indeed. In particular, Mrs Barker warned:
	"The industry needs to address its weak record of innovation and remove barriers to the take-up of modern methods of construction and off-site manufacturing.
	"Investment in skills needs to increase to produce higher levels of output in the future and to bring the take-up of apprenticeships towards the levels of leading international comparators. In the short-term, Government should consider increasing support for skills in the construction sector alongside any increases in the industry-funded training levy".
	She refers specifically to the matter before us.
	A report by the adult learning inspectorate, published in May last year, found that the construction industry's own research showed an acute shortage of skilled craftspeople. There are 300,000 fewer skilled craftspeople than the industry needs in terms of contracts already planned. During the 1970s, 100,000 people were being trained each year across a range of construction skills, but by 2004, that figure had declined to fewer than 40,000.
	The standard of training currently offered can only make the situation worse. Some 40 per cent of those being trained in construction industry skills were found by the adult learning inspectorate to be trained inadequately, and only 34 per cent of trainees complete their apprenticeships. Those are worrying figures, and they are worrying for all of us, regardless of party.
	While we are taking the orders together, I draw particular attention to the Construction Industry Training Board—the subject of the first of the orders. It is the largest provider of training in the building and crafts industries. It has 10,000 learners, but only 25 per cent of those will complete their qualifications. Nick Perry, director of inspection at the Adult Learning Inspectorate, commented that the construction industry must face up,
	"to the critical problems endemic in its training methods today",
	if the industry is to develop the new houses that the Government have planned for. Quite apart from the other buildings that emanate from such efforts to a standard that our nation deserves, urgent action is needed to improve the provision of training in the construction industry.
	The Minister said that there is support for the continuation of the levy at an appropriate level. That is vital. The level must be appropriate to deliver the sort of return that is needed. The Minister mentioned that support, and perhaps it is worth while amplifying his point by drawing your Lordships' attention to some figures: 72 per cent of employers support the continuation of the CITB levy-grant system; and 73 per cent believe that the amount of training in the industry would worsen in the absence of CITB construction skills.
	I draw two worries to the Minister's attention, and I hope that he will respond.
	First, in the past six years, the proportion of levy-paying employers who are members of the main employer federations has dropped from 58 per cent to just over 50 per cent. That reflects a decline in the percentage of construction employers who become federation members, rather than any diminution in support for the levy system in the industry. I mentioned the high level of support, but as fewer people become members of the federation, there is a worry that the levy system will cease to have the necessary depth of support to facilitate the outcomes that we all want.
	Secondly, we on these Benches have real concerns about the apprenticeship framework. The major cause of the current low level of apprenticeship framework completions in the construction industry is the failure of further education colleges to find work experience opportunities for trainees who are enrolled on full-time courses. This is one of the examples—there are others—of a gap between what we do in FE and what we do in industry. We need a greater synergy between the activities of further education colleges and the demands of a range of industries, including the construction industry. Perhaps that should be the substance of a debate for another day, but for now, we support the orders.

Baroness Sharp of Guildford: My Lords, the Minister and I have exchanged views on these two orders in the past five years in this House. He will know that we on these Benches very much support the notion of the Construction Industrial Training Board and the levy-grant system that it incorporates here. The construction industry and the construction engineering industry are both characterised by a small number of very large firms, by a large number of very small firms, and perhaps above all by a great deal of sub-contracting in the industry. It is partly because of that tradition of sub-contracting that the industry has been plagued by the free rider problem of someone else always having to do the training. Firms that do the training find that their apprentices are poached by other companies as soon as they are trained. All the expense of training is therefore regarded to some extent as wasted because others benefit from it. In those circumstances, many firms say that it is not worth while training. This has characterised the industry to far too great an extent, which is why we have the levy-grant system that underpins it.
	As the noble Baroness, Lady Buscombe, indicated, the system is endorsed by a large number of employers in both sectors. She quoted the figure of 72 per cent of employers in the construction industry who support the levy-grant system, and said that 73 per cent say that there would be less training if it were not there. It is notable, as the Minister said, that for every pound that is invested in training in the construction industry, it is reckoned that £1.79 worth of training is extracted. The figure is similar for the construction engineering industry; it is £1.45. So a good amount of leverage comes out of these expenditures.
	Like the noble Baroness, Lady Buscombe, I wish to put to the Minister a number of worries. The first picks up on the noble Baroness's point about the low completion rate of apprenticeships. She suggested that that was partly because colleges could not find work placements for apprentices—a second worry—but many apprentices do not complete their apprenticeship because they are offered a job before that. Perhaps too many employers are prepared to offer a job to apprentices who have not obtained their qualification. As the Minister knows, the ordinary apprenticeship results in a level 2 qualification but the industry regards the NVQ 3 as the proper, full apprenticeship. The failure of many apprentices to go on from level 2 to level 3 is very notable in the industry.
	The Minister might like to discuss the following point with his government colleagues in the other place. The Government will be funding a number of large construction projects, particularly in the run-up to the Olympic Games and, for example, in building schools for the future. They will be the major purchaser and funder of many projects. Is it not possible for the Government to write into their contracts the requirement that those employed should have the full qualifications necessary for the job? That would help good employers who fund training to encourage their apprentices to complete their apprenticeship, because they would be employing those with full qualifications rather than apprentices who dropped out half way through. Given the conditions written into many contracts—for example, those for motorways—it would not be an extraordinary contractual requirement.
	Secondly, there are now many more young people applying for apprenticeships than there are places available—in a sense, that is a very good upturn—because colleges find it so difficult to find work placements. In particular, it is very difficult to find work placements with small and medium-sized enterprises. I put it to the Minister that it might be feasible to give greater incentives to small and medium-sized enterprises to take on apprentices.
	The noble Baroness, Lady Buscombe, did not mention LSC funding of level 3 qualifications. As the Minister knows, the LSC will fund a level 3 apprentice up to 19. Many of those proceeding from level 2 to level 3 are over 19. Although there is an extreme shortage of skills in the industry, there is no public funding, and employer funding is required for post-19 qualifications. Quite a number of young men and women do not proceed to level 3 because they cannot get funding.
	The industry has benefited enormously from the influx of immigrant labour, particularly from eastern Europe, over the past three years, but that is not a satisfactory situation. The age profile of the industry is skewed towards those aged 45 and over at the moment. We must replace those older people with trained younger people whom we grow ourselves rather than import. It is important that there is every incentive for people to proceed to get their full qualification.

Lord Davies of Oldham: My Lords, I am grateful for the constructive contributions to this short debate on the training boards, which, it is recognised, play an important role in our economy. They could do better—all those who contribute to skills could do better, because we are all aware of the fact that it is an area of British education and training where we need to improve performance year on year. The identification of the issue goes back over decades, but the constructive action to deal with the skills shortages takes time before it makes an impact.
	I heard the noble Baroness, Lady Buscombe, when she indicated that it would be remiss of us to stray to wider issues of house-building strategies and demand for housing, which was the fault into which the Committee drifted in the Commons. Members of the Commons are rather more prone than your Lordships to score points off each other from time to time. What was an exercise in innocent fun by my honourable friend the Member for Normanton enlightened the Committee, but far be it from us to get into a major debate about housing policy at this place and time; except to say, as the noble Baroness accurately identified, that proposals for increasing the number of houses to be built make demands on the industry, which is short of skilled persons at present.
	I share the noble Baroness's worry about one aspect, which is that the decline of those firms that join the federation could lead us into great difficulty. If the number falls below the critical mass there is no way that we can operate, as we do within the framework of the law, the existing provisions with regard to levies. She is right about that matter but I am not sure if I detected a constructive answer on how it should be tackled. People join federations because they see benefits from the contributions the federation makes to the general work that they do, so we must look at ways in which the federations improve their standing. They have a long history and have been respected in the past, but she is right that an increasing number of companies are not joining, which is an anxiety.
	Both noble Lords who spoke emphasised the problems with regard to FE colleges and finding places. That is a genuine problem. We have greatly expanded further education opportunities, more young people are staying on in education than ever before and our colleges are expanding, but to do their job as effectively in education and training in key skill areas they need opportunities for young people to obtain direct work experience. That is always a challenge. I recall over all the expansion of vocational courses in this country, whether at further education or higher education level, that the pressure on succeeding in getting good training opportunities outside the education institutions has always been acute. I am confident that the further education Minister will respond to the challenge because courses will not succeed in training students otherwise, but it means a growing awareness in wider society that training young people is the seed-corn of the skills of the future and the backbone of the economy for the future.
	It is good to see that that is recognised on both sides of the House, as it was when the order was debated in the Commons, because we need to make the wider society aware of the necessity of contributions on all sides to improving skill levels and the opportunities for enhancing skills.
	The noble Baroness, Lady Sharp, asked whether the Olympic Games could contribute through public sector funding, but the Olympic Games funding is not directly under any government departmental control.

Baroness Sharp of Guildford: My Lords, I used that as an illustration. There are a large number of public sector-funded projects in the construction industry which, if the contracts were drawn up appropriately, could encourage those involved in such contracts to employ fully qualified young people.

Lord Davies of Oldham: My Lords, I was merely indicating that that particular illustration was not entirely valid because the games are not going to be funded by government. However, I accept the more general point that, where there is public funding, there are opportunities to be exploited in seeking assurances of this kind.
	The noble Baroness will recognise that, in an intensely competitive market, it is largely for the industry to address itself to these issues. There are real problems about government contracts being restrictive in these terms and effective without making the price too high, against a background where we have got a structure for training which needs a greater stimulus. I am not too sure that the measure proposed by the noble Baroness would meet the point. It smacks, if I may put this without being too contentious, of a certain degree of illiberalism and of direction from the centre.
	I am grateful to noble Lords for emphasising that we all share concerns about skills in our society. In construction and engineering the skill shortage is clear and needs to be remedied. These boards have crucial roles to play and that is why I commend the order to the House.

On Question, Motion agreed to.

Industrial Training Levy (Engineering Construction Board) Order 2006

Lord Davies of Oldham: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the draft order laid before the House on 9 January be approved [14th Report from the Joint Committee].—(Lord Davies of Oldham.)

On Question, Motion agreed to.

National Endowment for Science, Technology and the Arts (Increase of Endowment) Order 2006

Lord Davies of Oldham: rose to move, That the draft order laid before the House on 9 January be approved [14th Report from the Joint Committee].

Lord Davies of Oldham: My Lords, the endowment for NESTA—the National Endowment for Science, Technology and the Arts—is conferred by powers of the Secretary of State for Culture, Media and Sport under the National Lottery Act 1988. We propose to transfer to NESTA, over the next five years, £15 million a year from money held in the National Lottery Distribution Fund for expenditure on or connected with health, education or the environment.
	The fund was set up, of course, in 1998 to support and promote UK innovation, with a remit to support and promote talent, innovation and creativity in science, technology and the arts. I emphasise that the Government regard the history of the development of NESTA as most encouraging. As ever with anything to do with the cutting edge of technology, the arts and science, there are bound to be areas where initiatives achieve less than were hoped for—and there can, of course, be initiatives which excite a degree of controversy about their objectives—but, broadly, NESTA has played a very important role. It provides early risk capital which gives support to new ideas; it supports young, creative entrepreneurs; and it develops outstanding talent—the innovators of the future.
	This is a key stage in NESTA's evolution as an organisation. It has clearly made great progress since it has been established, but we believe that it will be 10 years before the real impact of NESTA's interventions will be felt. After all, these are seed-corn ideas, and seed-corn takes some time to germinate and develop.
	A condition of this additional funding for NESTA is that it is to use its own enterprise and creativity to secure its future beyond 2011. The Government are committed to following through on our long-term investment framework in harnessing innovation, so we will be conducting a thorough review of the organisation, evaluating its impact against a five-year plan objective, and looking at the endowment as an investment model more generally.
	We will also see what we can learn from NESTA's success and how that can inform general policy, because we believe that there are areas of conspicuous success. One aspect is the development of the advanced transport system. The British Airports Authority is making an additional £7.5 million investment to fund driverless electric pods which will connect Heathrow Airport with surrounding car parks—an exciting project. We need innovation in relation to air travel in particular. We are all too aware of the relationship between congestion on the ground and rapid movement through the skies. That is an important dimension.
	There are many other illustrations of NESTA providing some interesting contributions. The main areas of its work are developing a culture of entrepreneurship; building dynamic networks that can be creative about problem-solving; risk funding—increasing the accessibility of seed-capital for the most promising new ideas and creating sustainable partnerships with the angel and venture capital community; and successful commercialisation—developing the business skills and market focus of new businesses and young management.
	These are exciting projects. NESTA is one of the most exciting developments of recent years. It is not 100 per cent successful—how could it be with such a range of creative and imaginative ideas? Nevertheless, it is worthy of support for an important dimension of British life where we give necessary small amounts of support to really creative, novel ideas which can come to fruition and produce quite startling investment realisations. On that basis, I beg to move.

Moved, That the draft order laid before the House on 9 January be approved. [14th Report from the Joint Committee].—(Lord Davies of Oldham.)

Viscount Astor: My Lords, I thank the Minister for introducing the order. NESTA is a success, and one should congratulate the Government on bringing it into being. It occupies a part of the market that other funding bodies do not, particularly in giving small amounts of money to people who are involved in start-ups. As the Minister said, some of them work well and some do not—that is the nature of the game. NESTA has made more than 750 awards in its lifetime, and one can truly say that its funding is additional to government expenditure as opposed to some of the discussions and arguments we have had about other lottery fundings.
	It is a success, and one must congratulate the trustees and the management. The only thing that made me nervous was the Minister saying that he would have a thorough review. All I can say is: it works—don't muck it up.

Lord O'Neill of Clackmannan: My Lords, I am happy to follow these two contributions. NESTA is one of the Government's unsung successes. It has been able to identify areas where no other conventional means of support for business start-up have been available. It has often been able to support activities which otherwise would have fallen between the cracks of various forms of government support. The examples given to us include the work of Dr Kevin Fong, who was doing work in anaesthetics at University College, London, where the multi-disciplinary character of the work he was engaged in did not attract funding from any of the normal research sources. Getting the support of NESTA has enabled him to continue with his research work. This is investing in what could be called exceptional UK talent.
	Equally, it is fair to say that a number of the creative entrepreneurs coming out of our arts colleges and similar places would become distinguished crafts people if they were able to get the advice or the business start-up assistance to go on. Mark Bickers, a glassmaker who went on the Creative Pioneer course is now operating on a self-sustaining basis, selling to places such as Liberty.
	We sometimes think that business support is for very large operations or ones which of themselves will create a great number of jobs. But one of the great and telling lessons of the past couple of decades has been the significance of small business and the way in which small businesses take on two or maybe three employees and account for a sizeable amount of the increase in our employment rates.
	However, it is also fair to say that, where the money has gone in, in a number of instances it has been able to attract support from angels and venture capitalists on a ratio of £1 which would attract £5 from anywhere else. I imagine that the success of that is one of the driving forces behind the Government's review because it was set up with money from the Lottery—a source not available for any other purpose in this way—and it could be reaching the point of self-sustaining growth as an endowment. It is to that that we should look to the future. It is exciting that we have made this fairly modest contribution—because in terms of industrial support, £15 million per annum is not a massive sum. But Jonathan Kestenbaum, Chris Powell, the chair and their colleagues will be able to look forward to five years of sustained activity in which they will be able to establish the endowment as a means of giving young people—particularly young people involved in the creative areas, the grey areas of industrial and business activity—assistance and support. Just affording them the mentoring and network facilities that the endowment gives will help people who are on their own. They are often bewildered by the range of business opportunities that are supposed to be there and they never quite know how to take advantage of them, but they will be able to do so because of this endowment. It is a credit to the ingenuity of the first Labour government and it will be a credit to successive Labour governments because the success of our economy will come in large measure through the kind of work that the beneficiaries of the endowment have been able to take forward. A dynamic economy requires creative industry and creative industry hitherto has not been able to attract the kind of support that it is now getting, not only through the endowment but through the credibility which the endowment provides. It enables these individuals to go elsewhere and get the additional support that they need to make their businesses grow. I welcome the Government's courage in providing £75 million over the next five years and I welcome this order tonight.

Baroness Sharp of Guildford: My Lords, we too have no problem with this order. NESTA has been a great success. The Minister talked about it being an exciting development. It is not only exciting; it is very creative. He also said that not everything had been a success, but in the world of venture capital, you are lucky if one in 20 projects is a success. NESTA has hit rather more than one in 20, so it has a very good record. As the noble Lord, Lord O'Neill, mentioned, for every £1 that has been invested in NESTA, a further £5 has been leveraged for further financing.
	One of the current enterprises in which NESTA is involved is what they call their future lab, which is developing new learning software. The DfES has put in £3 million, and Microsoft and Disney are also putting in similar sums of money. A spin-out company is emerging from NESTA this April. All the creativity, dynamism and innovation are to be welcomed.

Lord Davies of Oldham: My Lords, I am grateful for that whole-hearted support—more than I had dared anticipate—particularly from the noble Viscount, Lord Astor, who rightly upbraided me by asking why we need a review when he is documenting success. He has made me think twice about that concept, too. We are looking upon NESTA moving to a more substantial and mature role in terms of its finances. I think the noble Viscount will recognise that the first few years had their difficulties with investment and support, and we are now seeing NESTA grow into a more substantial role. That is the necessity for the review. I give the noble Viscount the assurance that it is not broke, and we are not going to go about fixing it in crucial areas. I was grateful for his support.
	I was grateful to my noble friend Lord O'Neill. It is almost a NESTA-type innovation to have a Back-Bencher contribute to our orders, such is the restricted dialogue that goes on between the Front Benches, with limited Back-Bench contribution. I was grateful to him for contributing, particularly for his illustration of exceptional UK talent being nurtured by NESTA, and for emphasising the fact that there is some good value in the investment returns from the work which NESTA has done.
	I was also grateful to the noble Baroness, Lady Sharp, who expressed her enthusiasm for the work of the organisation. It is the single largest provider of early seed-funding in this country, willing to invest at a stage where it is notoriously difficult to get others to do so. It fills a crucial gap, and also explores what can happen when you merge the boundaries between science, technology and the arts. Having an endowment as a model of investment is essential to achieving its aims. My real answer to the noble Viscount is that we move from that degree of necessary support from the lottery into a situation where we hope the endowment will flourish sufficiently to guarantee the necessary resources. NESTA's influence is important in these terms.
	I am aware of a number of other criticisms which noble Lords were too kind to voice this evening. One is entirely valid, and I would have accepted it from any source. NESTA is not too good at blowing its own trumpet. It could do better with its own publicity, and that is something which we hope to impress upon it for the future. Success breeds success, but only if people are aware of that fact.

On Question, Motion agreed to.

Pensions Act 2004 (PPF Payments and FAS Payments) (Consequential Provisions) Order 2006

Lord Evans of Temple Guiting: rose to move, That the draft order laid before the House on 9 January be approved [14th Report from the Joint Committee].

Lord Evans of Temple Guiting: My Lords, in moving this order I shall speak also to the Pension Protection Fund (Pension Compensation Cap) Order 2006. I remind noble Lords that the Pension Protection Fund, or PPF, was created under the Pensions Act 2004 and began operating on 6 April 2005. The PPF was established to pay compensation to members of eligible defined-benefit pension schemes when there is a qualifying insolvency event in relation to the employer and where there are insufficient assets in the pension scheme to cover PPF levels of compensation.
	Noble Lords will be aware that, when an employer has an insolvency event, an assessment period is triggered during which time the scheme's assets and liabilities are valued to determine whether the PPF should assume responsibility for the pension scheme. The assessment period must last at least 12 months meaning that the earliest date from which the PPF can pay compensation is 12 months from 6 April 2005. Noble Lords are all aware of the importance of the Pension Protection Fund and the Financial Assistance Scheme—or FAS, as I will refer to it during the course of this debate.
	I turn to the first order before us today. The Pensions Act 2004 (PPF Payments and FAS Payments) (Consequential Provisions) Order will insert Pension Protection Fund payments, together with a definition of those payments, into existing regulation-making powers within a variety of Acts to enable income-related and contributory benefits to take into account the receipt of Pension Protection Fund payments by individuals when calculating the amount of benefit due in relation to contribution-based jobseeker's allowance, dependency increases in respect of incapacity benefit, maternity allowance, state pensions, carer's allowance and severe disablement allowance, incapacity benefit and state pension credit. In addition, Financial Assistance Scheme—FAS—payments are inserted into the Jobseekers Act 1995 so that they may be treated as income for the purposes of contributions-based jobseeker's allowance. The relevant powers are contained within Section 319(2)(a) of the Pensions Act 2004.
	When a member's occupational pension is replaced by PPF or FAS payments, those payments will not impact on certain income-related and contributory benefits unless current legislation is amended. Amendments to other benefit regulations are being taken forward separately by negative amending regulations as certain existing Acts already provide sufficient powers to make the necessary amendments without the requirement to amend primary legislation powers. These include housing benefit, council tax benefit, income support, and income-based jobseeker's allowance.
	The Financial Assistance Scheme was created to offer help to a number of people who have lost out on their defined-benefit pension scheme because their pension scheme was underfunded when it was wound up and their employer has been unable to make up the deficit. FAS became operational on 1 September 2005, and the first payments by FAS were made in December 2005. Because most FAS payments will not be made until the scheme members reach 65, only certain social security benefits need to be amended to take account of FAS payments. This order will amend the primary legislation for contribution-based jobseeker's allowance, by inserting a definition of FAS payments into regulation-making powers and by adding a reference to FAS payments in the list of payments in respect of where deductions are to be made within the contribution element of jobseeker's allowance.
	Noble Lords may be aware that regulations relating to FAS and state pension credit came into force on 18 December 2005 to take account of FAS payments that came into force in December 2005. The order ensures that individuals in receipt of benefits and PPF or FAS payments are no better off than individuals in receipt of benefits and occupational pensions.
	I shall now move on to the second instrument before us, the PPF (Pension Compensation Cap) Order 2006. This order follows the requirement in paragraph 27 of Schedule 7 to the Pensions Act 2004 to increase the amount of the compensation cap from 1 April 2006 in line with the increase in average earnings in the previous tax year. A compensation cap is applied to scheme members who are below the scheme's normal pension age at the start of the assessment period. These members are then eligible for a 90 per cent level of compensation when they retire.
	The amount of the current compensation cap was set from 6 April 2005 using data for average earnings and income available up to April 2004. The cap was set at £27,777.78 and currently provides a maximum amount of compensation, once the 90 per cent rule is applied, of £25,000 at age 65. Total average earnings, as published by the Office for National Statistics, increased by 4.2 per cent for the 2004–05 financial year. Applying this 4.2 per cent increase to the current cap provides an increased cap of £28,944.45, which provides a maximum amount of compensation, once the 90 per cent rule is applied, of £26,050.01 at age 65. That level of compensation is appropriate only to those members who became entitled to its 90 per cent level on or after 1 April 2006. The order therefore ensures that the compensation gap is uprated in line with the increase in average earnings.
	The two orders before us, which I am content are compatible with the human rights convention, ensure that compensation payments made to individuals out of the PPF are treated fairly and consistently with occupational pensions and earnings. I beg to move.
	Moved, That the draft order laid before the House on 9 January be approved [14th Report from the Joint Committee].—(Lord Evans of Temple Guiting.)

Lord Skelmersdale: My Lords, I am grateful to the Minister for his lucid explanation of the first two orders before us today. I, too, am happy to take them together.
	Concerning the first order, it is clear that a PPF pension or an FAS compensation amount in payment is income in the same way that state or occupational pensions are. They are, therefore, not only taxable but can diminish the award of the social security benefits that the Minister mentioned. Yet the order does rather go over the top; it is a belt and braces approach par excellence. I cannot imagine, for example, that anyone receiving income from the fund or the FAS will be receiving maternity allowance. Why is it therefore included in the list that he has just given?
	It is also worth noting that incapacity benefit is only reduced when a pension is in payment, not on any other occasion. Why, too, are state pensions on the Minister's list? These are paid as of right—that is, as long as sufficient national insurance contributions have been paid during a working life—and I see no reason why they should be reduced by virtue of receiving income from the PPF or FAS. Naturally, they would reduce any amount of pension credit payable. Part 3 of the schedule refers to that, and rightly so, but I should point out that it would be extremely rare for a payment from the FAS or PPF to be so low that any suggestion of pension credit would be considered. Can the Minister give examples of when and where that could happen?
	For many years, people of pension age have been encouraged to continue their working lives. A pensioner who continues to put off claiming their state pension beyond the retirement age for it will earn increments of 10.4 per cent for every extra year that they work. Provision was made in the Pensions Act 2004—wrongly, in my view, as I said in debate on it—that the pension due on any extra years worked post retirement age could be commuted into a lump sum. There is, as far as I know, no provision for that within the PPF; neither would there be in the FAS, since that is pure compensation. I therefore ask: is it intended that a PPF pension will be paid irrespective of whether the potential recipient continues working, presumably in another job?
	As for the pension compensation cap, the noble Lord, Lord Oakeshott, is too kind to criticise me when I describe most uprating statements as boring, which I do from time to time. My use of "boring" is perhaps a little eccentric: it is in the sense of "predictable". Governments have to uprate benefits every year; so, indeed, must they uprate the cap, though that is not by inflation but by earnings, should they exceed a certain amount in the previous year. As the Minister explained, that is why we have the second order. Even so, I am afraid I have a question on that too. Paragraph 4(3) of the Explanatory Note states that the level of compensation cap encourages scheme members to become more involved in scheme matters. Therefore, given the whole rationale of the scheme—that a pension scheme has entered the FAS by default—how can the level of the cap encourage members of defunct schemes to become so involved?

Lord Oakeshott of Seagrove Bay: My Lords, I am not sure that I quite followed the reference by the noble Lord, Lord Skelmersdale, to "boring", but in my case I certainly do not regard boring as a pejorative term. Indeed, the Government could do with being a lot more boring and a lot less frenetic in their activities, chopping and changing in all sorts of areas.
	Moving on to the orders—I intend to take every opportunity that I can to keep speaking up in Parliament for the 85,000 members of collapsed pension schemes who have been shamefully let down by this Government with their pitiful £20 million a year Financial Assistance Scheme. The FAS is a cruel deception.
	Is the Minister aware that even the National Association of Pension Funds last week said:
	"The government's FAS is a half-hearted, inadequate patch-up job. There's a problem getting confidence back into pensions, and the impact of leaving 60,000 people with next to nothing is considerable"?
	It added that the Government's commitment of £20 million a year was "vastly inadequate", and a
	"fudge to cheaply buy off Labour backbenchers".
	The National Association of Pension Funds is the leading independent body in this country.
	How many people have now received payments from the FAS? The excellent Pensions Week, as part of its Campaign for Pensions Justice, reported on 23 January that at that stage only 13 people had actually received payments. What is the latest total? This Government loves targets. How many people do they expect will have received payments from the financial assistance scheme by the end of June this year and how many more by the end of the year?
	We have no objection to the details of this order or to the PPF compensation cap uprating.

Lord Evans of Temple Guiting: My Lords, I am grateful to both noble Lords who have contributed to this short discussion. The PPF has been heavily debated in both Houses from the passage of the Pensions Act 2004 until more recently in July 2005, when we debated regulations on ombudsman provisions and fraud compensation requirements before they came into force.
	I am sure that all noble Lords will join me in supporting the aims of the PPF, to provide support to members who would otherwise lose out if the employer became insolvent and there were insufficient funds in the pension scheme. I note the comments made by the noble Lord, Lord Oakeshott, on this matter.
	First, I thank noble Lords for welcoming the two orders. The order does not seek to take PPF compensation into account for payments of maternity allowance or state pensions themselves, but refers to adult dependency increase in relation to these benefits. We consider these amendments are necessary, as PPF compensation can be accessed from the age of 50. While we accept that the current number affected is not large, it is important to ensure consistency of treatment of PPF recipients, with the treatment of people in cases where payments of an occupational pension are made. In addition, we believe that the number of PPF compensation recipients will increase.
	Since the national insurance scheme started in 1948, the availability of an increase of benefit in respect of a spouse has been subject to an earnings rule. The purpose of that is to provide a simple test of the extent to which the spouse is financially dependent on the benefit customer. Earnings include pensions paid by employers and from personal pensions, and will include PPF payments. It is conceivable that a claim can be made for an adult dependency increase in maternity allowance for a spouse who receives PPF payments, given that compensation can be payable from the age of 50. Dependency increases for state pensions cease to be payable when the spouse's earnings exceed a certain limit. The limits are £56.20 per week for 2005–06 if a married couple live together and £49.15 per week when a married couple live apart.
	Incapacity benefit takes 50 per cent of occupational pension above £85 per week into account. Incapacity benefit will apply the same rules to PPF payments. However, if PPF payments are payable to a survivor, the entire payment, as with occupational pension, is disregarded. Similarly, state pension credit takes occupational pension income fully into account and will mirror that approach for PPF payments, having already done so for FAS payments.
	If a member has only two years' service when the PPF assume responsibility for their scheme, their PPF payment may be quite small. Although a member has the option to swap this payment for a lump sum, they may wish to receive compensation as a regular income. The member may also be entitled to state pension credit; this order will enable their PPF payment to be treated in the same way as the occupational pension income would have been treated.
	A question was asked by the noble Lord about the pension compensation cap order. This relates to the Pension Protection Fund. FAS applies to these schemes which began winding up between 1 January 1997 and 5 April 2005. PPF applies to those schemes whose sponsoring employers have an insolvency event on or after 6 April 2005. This order increases the Pension Protection Fund compensation cap, set last year in line with average earnings, in accordance with the requirements of the Pensions Act 2004. We believe that the compensation cap will both provide the necessary cost control and encourage members below normal pension age to maintain a vested interest in ensuring that their scheme remains solvent and out of PPF.
	The noble Lord, Lord Oakeshott, said that when he last heard, FAS payments were being made to 13 people; he may be pleased to hear that we are currently making FAS payments to 15 people. We can make payments only to members of schemes who have provided us with the data we need to assess eligibility and calculate payments; to date, only two schemes have provided suitable data. We are confident that the number of payments will increase in February. We continue to work with schemes to get the information we need to make more payments. As usable data comes in, I expect the number of payments to rise significantly. It is vital that schemes supply data on their members without delay.
	The noble Lord, Lord Skelmersdale, asked whether the PPF would continue to be paid when the member works in another job; the answer is yes. The noble Lord, Lord Oakeshott, asked whether the provision £400 million is enough. The Government have always said that the FAS will not give everyone all they want. The primary objective is to provide significant help to those who have lost the most and need help most urgently. As with all our spending plans, funding for the FAS will need to be reviewed in the next spending review, along with other spending priorities. These orders provide for the equal treatment of compensation payments in relation to state benefits, and ensure that the reduced level of compensation is maintained, in line with increases in average earnings. Again, I commend these orders to the House.

On Question, Motion agreed to.

Pension Protection Fund (Pension Compensation Cap) Order 2006

Lord Evans of Temple Guiting: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the draft order laid before the House on 11 January be approved [14th Report from the Joint Committee].—(Lord Evans of Temple Guiting.)

On Question, Motion agreed to.

Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment)Regulations 2006

Lord Evans of Temple Guiting: rose to move, That the draft regulations laid before the House on 12 January be approved [14th Report from the Joint Committee].

Lord Evans of Temple Guiting: My Lords, the Pensions Act 2004 introduced powers to enable regulations to be made setting out a statutory requirement on employers to consult affected scheme members when a change is proposed to their scheme. It is important that employers consult on prospective changes to these pension schemes in order to involve scheme members in the future of the scheme. That will ensure that the affected scheme members fully understand the changes and, in particular, the likely impact on their future pension. We have worked closely with the CBI and TUC on these provisions and we consulted publicly on the detailed provisions over the summer of 2005.
	The regulations in this statutory instrument set out the detailed consultation requirements and correct a typographical error in the Financial Assistance Scheme (Internal Review) Regulations 2005. These regulations will require larger employers to consult on specified proposed changes to their pension schemes. The regulations introduce a similar requirement for employer consultation on proposed pension scheme changes to those in the Information and Consultation of Employees Regulations 2004 for other workplace organisational issues. Those regulations came into force for organisations with 150 or more employees from April 2005.
	The consultation by employers regulations will be phased in so that from April 2006 only employers with more than 150 staff will, unless exempted, be required to consult their employees on pension changes. From April 2007, employers with more than 100 employees will have to consult and, from April 2008, the requirement will be introduced for employers with more than 50 employees. As I said, we will amend these figures to ensure consistency with the Information and Consultation of Employees Regulations 2004.
	The regulations will not apply to any proposal that the members were advised of before the regulations come into force on 6 April or to employers in respect of certain pension schemes. The regulations require an employer to consult when a proposal is made to make a significant change to either an occupational pension scheme or a personal pension scheme where the employer contributes under a direct payment arrangement.
	The employer must consult the affected members of the pension scheme or their representatives before a decision on whether to make such a change is taken. "Affected members" are defined as active members and prospective members of the scheme. A prospective member is an employee who will become eligible to become a member of the scheme.
	The regulations list the significant changes that the employer will be required to consult on. Such changes to an occupational pension scheme will include: closing the scheme to new members; stopping future accrual of benefits, or rights, in the scheme; removing the employer's contributions; and, finally, introducing member contributions.
	In addition, the employer is required to consult on certain proposed changes that affect only occupational pension schemes that are not money purchase schemes—that is, defined benefit schemes. These changes affect the basis of the scheme. They include, for example, changing the scheme, in full or in part, to a money purchase scheme or changing the method for the accrual of benefits, or rights, in the scheme—for example, from final salary to career average. For personal pension schemes, the employer will be required to consult when he proposes to stop or reduce his contribution to the scheme or increase the members' contributions.
	The regulations also specify whom the employer must consult and they specify that he must ensure as far as reasonably practicable that the consultation covers all affected members. The regulations allow the employer, to a certain extent, to choose from a variety of prescribed consultation arrangements how he will achieve that. An employer who is required to consult about a proposed change to a pension scheme and who has already agreed consultation arrangements with his employees, which are of the type listed in the regulations, must consult using one or more of those arrangements. The regulations allow him to choose from recognised trade union representatives, elected or appointed information and consultation representatives, any other pre-existing agreement, or pension representatives elected under these regulations.
	The employer may consult directly with affected members if he has a pre-existing or negotiated agreement with his employees permitting this. The regulations also set out other requirements for the consultation. They prescribe that the consultation must take at least 60 days, that the responses to the consultation must be considered before deciding whether to make the change to the scheme, and that the employer and the person consulted work together in a spirit of co-operation.
	The Pensions Regulator is permitted by the regulations to waive or relax the consultation requirements if it is in the interest of scheme members to do so. In addition, the people consulted under the regulations and other employees will receive employment rights protection against unfair dismissal or other detriment as a result of their actions under the regulations. This is achieved through the schedule to the regulations, which in part amend the Employments Rights Act 1996 and the Employment Tribunals Act 1996.
	These regulations amend a typographical error that was brought to this House's attention on 22 November last year. The typographical error occurs in what is now Regulation 5(3) of the Financial Assistance Scheme (Internal Review) Regulations 2005, which is now corrected, as amended by the Financial Assistance Scheme (Modifications and Miscellaneous Amendments) Regulations 2005 which came into force on 24 November 2005.
	We said at the time that we would correct this error at the earliest opportunity. We have done so and the correction is contained in the regulations that we are debating today. The correction restores the original intention of allowing the scheme manager to extend the one-month time limit for scheme members to ask for an internal review to 12 months where necessary.
	I move on to the Information and Consultation of Employees (Amendment) Regulations 2006. This is consequential to the main set of regulations that I have just discussed. As many of you will be aware, the Information and Consultation of Employees Regulations 2004—commonly known as the ICE regulations—came into force in April 2005 for organisations with 150 or more employees. Introduced as part of a landmark framework agreement between the CBI and the TUC, they established important rights for employees to be consulted on an ongoing basis about matters which affect them.
	The ICE regulations are designed to be flexible. They allow employers and employees to agree consultation arrangements, tailored to suit their needs. Consultation arrangements may cover a wide range of strategic issues and could include listed changes to pension schemes. There is, therefore, some potential for an overlap between the ICE regulations and our proposed new requirement to consult on changes to pension schemes. During the Department for Work and Pension' s public consultation in June, a number of consultees, including the CBI expressed concern that employers might be required to consult about listed pension changes under both regulations.
	We understand their concerns. It is not right that an employer may find that he is expected to consult on listed pensions changes under both regimes, or could be exposed to double jeopardy. These regulations deal with this issue by amending the ICE regulations. The amendments ensure that the employer is required to consult under our pension regulations only, not under the ICE regulations, provided that he notifies the relevant employees or their representatives of his intentions in advance.
	Our approach has a precedent. The ICE regulations contain a number of similar provisions, to ensure that there is no overlap between them and other long-standing requirements on employers to consult about collective redundancies and business transfers. This SI simplifies the law and prevents a potential overlap between two sets of obligations on employers. The two instruments ensure that employers will consult their employees or their representatives so that pension scheme members are fully aware of the implications of a proposed change to their pension and that there is meaningful discussion with their employer about the proposal. They also provide that an employer will have to consult under the pension provisions only, and not under the ICE regulations as well. Again, I am satisfied that these instruments are compatible with the European Convention on Human Rights, and I commend them to the House. I beg to move.
	Moved, That the draft regulations laid before the House on 12 January be approved [14th Report from the Joint Committee].—(Lord Evans of Temple Guiting.)

Lord Skelmersdale: My Lords, I am again most grateful to the Minister. I am the first to agree that consultation is necessary when an employer proposes a change to a pension scheme. Such changes, as the Minister has said, may involve a move from a defined benefits scheme to a money purchase scheme. I note that full consultation is to be phased in, so that, in the first instance, a requirement to consult applies only to firms employing more than 150 staff from April this year. From April 2007 it will be firms with 100 to 150 staff; and from April 2008, it will be firms with 50 or more—unless, as the Minister said in his introduction, they are exempted. That rather confused me. Just who may be exempted, and why?
	It is good employer practice to consult, and I recognise the list of consultees that the Minister gave us. My problem, however, is that the employer may choose from recognised trade union representatives, elected or appointed information and consultation representatives, those under any pre-existing consultation arrangements or representatives of the pension scheme—I stress "or". Why is the department allowing employers to "perm" one from five, to use a football pools analogy? Pension scheme representatives should always be consulted, and at least one other—either trade union, or elected or appointed information and consultation representatives.
	I shall change track slightly. Consultations are all very well, but they must be real—by which I mean that the employer must be prepared to change his mind, either in general or particular, otherwise there is no point in consultation at all. I note that these regulations attempt to make these consultations real, and the Minister has explained how this is to be done. Being of a suspicious nature, however, I had asked him how this is to be policed. Are there to be arrangements for an appeal to the Pensions Regulator if the consultees feel that they have been ignored, or what?
	The original information and consultation of employees regulations—the so-called ICE regulations—were an important step forward in employer/employee relations. They established the right of employees to be consulted on an ongoing basis about matters which affect them. It seems obvious that changes to pension schemes would indeed affect employees, and would therefore be covered by the ICE regulations. It would be regulation gone mad, however, if employers had to consult about listed pension scheme changes under both that and the first of these two sets of regulations.
	Today's second lot of regulations requires that as long as the employer tells his employees' representatives under which regulations he is consulting them, he has to do so under only one regulation. That is common sense, and I am delighted to see the Information and Consultation of Employees (Amendment) Regulations 2006. I am even more delighted to see that the Government have taken note of their consultation, and that that consultation, at least, was real.

Lord Oakeshott of Seagrove Bay: My Lords, I congratulate the noble Lord, Lord Skelmersdale, on his diligence in inquiring into this. He has left no stone unturned, and I therefore do not intend to try to turn any. I look forward to the Minister's reply with interest.

Lord Evans of Temple Guiting: My Lords, I am grateful to both noble Lords for their contribution. Our congratulations to the noble Lord, Lord Skelmersdale, on spotting the slight difference between these two sets of regulations. An example would have been that, as he said, from April 2008, under these regulations an employer with exactly 50 employees would not have to consult on pension changes, whereas under the Information and Consultation of Employees Regulations 2004, an employer with 50 would. The difference is one employee.
	We accept that this is a very unsatisfactory situation, and will take action to remedy it at the earliest opportunity. It is our intention to make the necessary amendment in time for it to come into force at the same time as these regulations.
	The noble Lord, Lord Skelmersdale, asked about the reason for exempting small employers. As I explained, the exemption for small employers will be phased in over the next two years so that, from April 2008, only employers with fewer than 50 employees will be exempt from the requirement to consult about pension changes. This is consistent with the wider consultation arrangements under the Information and Consultation of Employees Regulations. We would encourage all employers, irrespective of size, to consult their employees as a matter of good practice, but it would not be proportionate to impose an additional burden on small businesses.
	The noble Lord also suggested that an employer should consult the pension representative and at least one other set of representatives. Our intention is to promote meaningful consultation in ways best suited to individual companies. We do not wish to disturb existing consultation arrangements that are working, nor do we want to prescribe a one-size-fits-all approach.
	The regulations provide that the employer who is required to consult must make arrangements to ensure that, as far as is reasonably practicable, he consults all the affected members of the pension scheme. The employer may choose from the consultation arrangements that he has already agreed with his employees or elected pension representatives in deciding how he achieves this. Provided that the employer makes arrangements to consult all the affected members or their representatives, we believe this to be sufficient. Requiring employers to consult pension representatives and other representatives could be cumbersome and inefficient, as well as placing an additional, unnecessary burden on employers.
	The noble Lord asked me to explain the arrangements for policing these regulations. The Pensions Regulator will oversee compliance with the regulations. If the consultation requirement is breached, affected employees may complain to the regulator, who will consider action against the employer which could ultimately lead to a financial penalty.
	I am sure that all noble Lords will join me in supporting the aims of the regulations on consultation by employers. They will provide information and an opportunity for discussion to affected members of an employer's pension scheme when a significant change is proposed. It is important that individuals are fully aware of the implications of changes to their pensions so they can adjust their savings and retirement plans accordingly.
	These two sets of regulations will allow the consultation by employers and the information and consultation of employees provisions to operate as intended.

On Question, Motion agreed to.

Information and Consultation of Employees (Amendment) Regulations 2006

Lord Evans of Temple Guiting: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the draft regulations laid before the House on 12 January be approved [15th Report from the Joint Committee].—(Lord Evans of Temple Guiting.)

On Question, Motion agreed to.
	House adjourned at twenty-one minutes before seven o'clock.
	Thursday, 9 February 2006.